Insider Buying: PHX Energy Services And More

Generally, insiders buying more shares in their own firm sends a bullish signal. A research published in The MIT Press (1998) concluded that stocks following insider buying outperformed the market by 4.5%. Though it is certainly not sufficient to base your investment decision merely on these signals alone, below I’ve put together three stocks you should examine further.

PHX Energy Services Corp. (TSX:PHX)

PHX Energy Services Corp., through its subsidiaries, provides horizontal and directional drilling technology and services to oil and natural gas producing companies in Canada, the United States, Albania, and Russia. The company size now stands at 668 people and has a market cap of CAD CA$115.04M, putting it in the small-cap category.

PHX Energy Services Corp (TSX:PHX) is one of Canada’s small-cap stocks that saw some insider buying over the past three months, with insiders investing in 168,600 shares during this period. In total, individual insiders own over 9 million shares in the business, which makes up around 15.2% of total shares outstanding. Latest buying activities involved the following insiders: John Hooks (management) . and Michael Buker (management and board member) . With revenues predicted to grow at 11.72% next year driving an impressive earnings growth of 62.60%, insiders may be buying based on PHX’s optimistic outlook which they believe are not yet priced into the stock. More detail on PHX Energy Services here.

TSX:PHX Insider_trading Apr 11th 18
TSX:PHX Insider_trading Apr 11th 18

Cara Operations Limited (TSX:CARA)

Cara Operations Limited operates and franchises full service restaurants. Founded in 1883, and headed by CEO William Gregson, the company currently employs 11,600 people and has a market cap of CAD CA$1.76B, putting it in the small-cap group.

Cara Operations Limited’s (TSX:CARA) insiders have invested more than 3 million shares in the large-cap stocks within the past three months. In total, individual insiders own over 2 million shares in the business, which makes up around 2.48% of total shares outstanding. The entity that bought on the open market in the last three months was Fairfax Financial Holdings Limited. Although this is an institutional investor, rather than a company executive or board member, the insights gained from direct access to management as a large investor would make it more well-informed than the average retail investor. In this specific instance, I would classify this investor as a company insider. Within the past three months, Cara Operations’s share price traded at a high of CA$29.6 and a low of CA$23.51. This suggests moderate volatility with a share price movement of 25.9%, which insiders may deem as an opportunity to increase their shareholdings. Interested in Cara Operations? Find out more here.

TSX:CARA Insider_trading Apr 11th 18
TSX:CARA Insider_trading Apr 11th 18

The Bank of Nova Scotia (TSX:BNS)

The Bank of Nova Scotia provides various financial services in North America, Latin America, the Caribbean and Central America, and the Asia-Pacific. Established in 1832, and currently headed by CEO Brian Porter, the company provides employment to 89,755 people and with the stock’s market cap sitting at CAD CA$92.76B, it comes under the large-cap category.

The Bank of Nova Scotia (TSX:BNS) is one of Canada’s large-cap stocks that saw some insider buying over the past three months, with insiders investing in 2,000 shares during this period. In total, individual insiders own less than one million shares in the business, or around 0.03% of total shares outstanding. The insider that recently bought more shares is L. Thomson . Within the past three months, Bank of Nova Scotia’s share price traded at a high of CA$82.53 and a low of CA$76.22. This indicates a trivial share price movement, with a change of 8.28%. This could indicate insider transactions are not driven by share price changes but perhaps due to their belief of the company’s growth prospects or just personal portfolio re-weighting. Interested in Bank of Nova Scotia? Find out more here.

TSX:BNS Insider_trading Apr 11th 18
TSX:BNS Insider_trading Apr 11th 18

For more stocks with high, positive trading volume by insiders, explore this interactive list of stocks with recent insider buying.