With Anaergia Up 10%, Insider Buyers Count Their Returns

Anaergia Inc. (TSE:ANRG) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 10%, resulting in a CA$46m rise in the company's market capitalisation, translating to a gain of 285% on their initial investment. Put another way, the original CA$400.0k acquisition is now worth CA$1.54m.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

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The Last 12 Months Of Insider Transactions At Anaergia

Over the last year, we can see that the biggest insider purchase was by Executive Director Andrew Benedek for CA$252k worth of shares, at about CA$0.90 per share. We do like to see buying, but this purchase was made at well below the current price of CA$2.88. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.

While Anaergia insiders bought shares during the last year, they didn't sell. They paid about CA$0.75 on average. To my mind it is good that insiders have invested their own money in the company. However, you should keep in mind that they bought when the share price was meaningfully below today's levels. 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!

Check out our latest analysis for Anaergia

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Does Anaergia Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Anaergia insiders own about CA$129m worth of shares. That equates to 26% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Does This Data Suggest About Anaergia Insiders?

It doesn't really mean much that no insider has traded Anaergia shares in the last quarter. However, our analysis of transactions over the last year is heartening. With high insider ownership and encouraging transactions, it seems like Anaergia insiders think the business has merit. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Anaergia. Case in point: We've spotted 2 warning signs for Anaergia you should be aware of, and 1 of them is a bit concerning.

But note: Anaergia may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

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 of direct interests only, but not derivative transactions or indirect interests.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.