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It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we’ll take a look at whether insiders have been buying or selling shares in Frontera Energy Corporation (TSE:FEC).
What Is Insider Selling?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.’
Frontera Energy Insider Transactions Over The Last Year
While no particular insider transaction stood out, we can still look at the overall trading.
Happily, we note that in the last year insiders bought 6500 shares for a total of CA$118k. Frontera Energy may have bought shares in the last year, but they didn’t sell any. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Frontera Energy is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Does Frontera Energy Boast High Insider Ownership?
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. Our data isn’t picking up on much insider ownership at Frontera Energy, though insiders do hold about CA$124k worth of shares. This level of insider ownership is notably low, and not very encouraging.
What Might The Insider Transactions At Frontera Energy Tell Us?
It doesn’t really mean much that no insider has traded Frontera Energy shares in the last quarter. However, our analysis of transactions over the last year is heartening. While we have no worries about the insider transactions, we’d be more comfortable if they owned more Frontera Energy stock. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
But note: Frontera Energy 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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.