Insiders At CES Energy Solutions Sold CA$21m In Stock, Alluding To Potential Weakness

Many CES Energy Solutions Corp. (TSE:CEU) insiders ditched their stock over the past year, which may be of interest to the company's shareholders. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

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.

See our latest analysis for CES Energy Solutions

The Last 12 Months Of Insider Transactions At CES Energy Solutions

In the last twelve months, the biggest single sale by an insider was when the Independent Chairman of the Board, Kyle Kitagawa, sold CA$7.5m worth of shares at a price of CA$7.05 per share. That means that an insider was selling shares at slightly below the current price (CA$8.05). 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. 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. 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. But insiders sold 3.73m shares worth CA$21m. In total, CES Energy Solutions insiders sold more than they bought over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. 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.

Insiders At CES Energy Solutions Have Sold Stock Recently

The last three months saw significant insider selling at CES Energy Solutions. In total, insiders dumped CA$2.4m 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

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Insiders own 3.5% of CES Energy Solutions shares, worth about CA$65m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At CES Energy Solutions Tell Us?

Insiders sold CES Energy Solutions shares recently, but they didn't buy any. Zooming out, the longer term picture doesn't give us much comfort. On the plus side, CES Energy Solutions makes money, and is growing profits. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. So we'd only buy after careful consideration. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing CES Energy Solutions. To assist with this, we've discovered 2 warning signs that you should run your eye over to get a better picture of CES Energy Solutions.

Of course CES Energy Solutions may not be the best stock to buy. So you may wish to see this free collection of high quality 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 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.