Don't Ignore The Insider Selling In CES Energy Solutions

We wouldn't blame CES Energy Solutions Corp. (TSE:CEU) shareholders if they were a little worried about the fact that Kenneth Zinger, the President recently netted about CA$2.1m selling shares at an average price of CA$7.16. That's a big disposal, and it decreased their holding size by 12%, which is notable but not too bad.

View our latest analysis for CES Energy Solutions

The Last 12 Months Of Insider Transactions At CES Energy Solutions

Over the last year, we can see that the biggest insider sale was by the Independent Chairman of the Board, Kyle Kitagawa, for CA$7.5m worth of shares, at about CA$7.05 per share. That means that even when the share price was below the current price of CA$7.39, an insider wanted to cash in some shares. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was just 40% of Kyle Kitagawa's stake. Notably Kyle Kitagawa was also the biggest buyer, having purchased CA$8.2m worth of shares.

Over the last year, we can see that insiders have bought 1.17m shares worth CA$8.2m. On the other hand they divested 2.81m shares, for CA$21m. Over the last year we saw more insider selling of CES Energy Solutions shares, than buying. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

I will like CES Energy Solutions better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Insider Ownership Of CES Energy Solutions

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. CES Energy Solutions insiders own about CA$55m worth of shares. That equates to 3.4% of the company. 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 CES Energy Solutions Insiders?

Insiders sold stock recently, but they haven't been buying. Zooming out, the longer term picture doesn't give us much comfort. But it is good to see that CES Energy Solutions is growing earnings. Insiders own shares, but we're still pretty cautious, given the history of sales. We'd practice some caution before buying! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 3 warning signs for CES Energy Solutions you should be aware of.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.