Who Has Been Selling Ballard Power Systems Inc. (TSE:BLDP) Shares?

By
Simply Wall St
Published
February 14, 2021
TSX:BLDP
Source: Shutterstock

We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So before you buy or sell Ballard Power Systems Inc. (TSE:BLDP), you may well want to know whether insiders have been buying or selling.

Do Insider Transactions Matter?

Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, rules govern insider transactions, and certain disclosures are required.

We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But it is perfectly logical to keep tabs on what insiders are doing. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise'.

Check out our latest analysis for Ballard Power Systems

The Last 12 Months Of Insider Transactions At Ballard Power Systems

Over the last year, we can see that the biggest insider sale was by the CEO, President & Director, R. MacEwen, for CA$1.5m worth of shares, at about CA$20.88 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of CA$45.73. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. It is worth noting that this sale was only 22% of R. MacEwen's holding. Notably R. MacEwen was also the biggest buyer, having purchased CA$759k worth of shares.

In the last twelve months insiders purchased 50.00k shares for CA$759k. But insiders sold 430.28k shares worth CA$8.2m. Over the last year we saw more insider selling of Ballard Power Systems shares, than buying. The average sell price was around US$19.02. It's not particularly great to see insiders were selling shares at below recent prices. Of course, the sales could be motivated for a multitude of reasons, so we shouldn't jump to conclusions. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
TSX:BLDP Insider Trading Volume February 15th 2021

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Insiders at Ballard Power Systems Have Sold Stock Recently

The last quarter saw substantial insider selling of Ballard Power Systems shares. In total, insiders sold CA$848k worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.

Insider Ownership of Ballard Power Systems

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Ballard Power Systems insiders own 0.2% of the company, worth about CA$22m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Ballard Power Systems Insiders?

Insiders haven't bought Ballard Power Systems stock in the last three months, but there was some selling. Zooming out, the longer term picture doesn't give us much comfort. Insiders own shares, but we're still pretty cautious, given the history of sales. We'd practice some caution before buying! While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. To assist with this, we've discovered 4 warning signs that you should run your eye over to get a better picture of Ballard Power Systems.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions, but not derivative transactions.

When trading Ballard Power Systems or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted


Discounted cash flow calculation for every stock

Simply Wall St does a detailed discounted cash flow calculation every 6 hours for every stock on the market, so if you want to find the intrinsic value of any company just search here. It’s FREE.

Make Confident Investment Decisions

Simply Wall St's Editorial Team provides unbiased, factual reporting on global stocks using in-depth fundamental analysis.
Find out more about our editorial guidelines and team.