Despite Hitting CA$0.19, Goodfood Market Insiders Still Sold Too Soon

Goodfood Market Corp.'s (TSE:FOOD) value has fallen 14% in the last week, but insiders who sold CA$484k worth of stock over the last year have had less success. Insiders might have been better off holding onto their shares, given that the average selling price of CA$0.46 is still below the current share price.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

We've discovered 5 warning signs about Goodfood Market. View them for free.

Goodfood Market Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Co-Founder, Jonathan Ferrari, sold CA$214k worth of shares at a price of CA$0.46 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The good news is that this large sale was at well above current price of CA$0.19. So it may not shed much light on insider confidence at current levels.

Goodfood Market insiders didn't buy any shares over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Check out our latest analysis for Goodfood Market

If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.

Goodfood Market Insiders Are Selling The Stock

Over the last three months, we've seen significant insider selling at Goodfood Market. Specifically, insiders ditched CA$483k worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Goodfood Market insiders own 20% of the company, worth about CA$3.8m. 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 Do The Goodfood Market Insider Transactions Indicate?

Insiders sold Goodfood Market shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. While insiders do own shares, they don't own a heap, and they have been selling. So we'd only buy after careful consideration. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example, Goodfood Market has 5 warning signs (and 1 which is a bit concerning) we think you should know about.

But note: Goodfood Market 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.