Have Canadian Natural Resources Limited (TSE:CNQ) Insiders Been Selling Their Stock?

By
Simply Wall St
Published
August 15, 2021
TSX:CNQ
Source: Shutterstock

Some Canadian Natural Resources Limited (TSE:CNQ) shareholders may be a little concerned to see that the Director, Steve Laut, recently sold a substantial CA$3.2m worth of stock at a price of CA$41.83 per share. However, that sale only accounted for 3.5% of their holding, so arguably it doesn't say much about their conviction.

View our latest analysis for Canadian Natural Resources

Canadian Natural Resources Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Executive Chairman, Norman Edwards, sold CA$11m worth of shares at a price of CA$45.35 per share. So we know that an insider sold shares at around the present share price of CA$41.30. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.

Happily, we note that in the last year insiders paid CA$3.1m for 113.41k shares. But insiders sold 743.33k shares worth CA$30m. All up, insiders sold more shares in Canadian Natural Resources than they bought, over the last year. The average sell price was around CA$40.94. It's not too encouraging to see that insiders have sold at below the current price. 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. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

insider-trading-volume
TSX:CNQ Insider Trading Volume August 16th 2021

I will like Canadian Natural Resources better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Does Canadian Natural Resources Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Canadian Natural Resources insiders own 2.2% of the company, currently worth about CA$1.1b based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Does This Data Suggest About Canadian Natural Resources Insiders?

Insiders sold stock recently, but they haven't been buying. Zooming out, the longer term picture doesn't give us much comfort. On the plus side, Canadian Natural Resources makes money, and is growing profits. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Canadian Natural Resources. To that end, you should learn about the 3 warning signs we've spotted with Canadian Natural Resources (including 1 which can't be ignored).

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, but not derivative transactions.

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