Stock Analysis

The Executive Vice President of Operations of Paramount Resources Ltd. (TSE:POU), David Reid, Just Sold 44% Of Their Holding

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Anyone interested in Paramount Resources Ltd. (TSE:POU) should probably be aware that the Executive Vice President of Operations, David Reid, recently divested CA$498k worth of shares in the company, at an average price of CA$29.32 each. The eyebrow raising move amounted to a reduction of 44% in their holding.

Check out our latest analysis for Paramount Resources

Paramount Resources Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Executive Vice President of Finance Bernard Lee bought CA$780k worth of shares at a price of CA$31.50 per share. That means that an insider was happy to buy shares at above the current price of CA$28.49. Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels. We note that Bernard Lee was both the biggest buyer and the biggest seller.

Happily, we note that in the last year insiders paid CA$1.3m for 42.72k shares. But they sold 67.92k shares for CA$2.3m. All up, insiders sold more shares in Paramount Resources than they bought, over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

TSX:POU Insider Trading Volume March 17th 2023

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Insider Ownership Of Paramount Resources

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Paramount Resources insiders own about CA$34m worth of shares. That equates to 0.8% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Does This Data Suggest About Paramount Resources Insiders?

The insider sales have outweighed the insider buying, at Paramount Resources, in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. But since Paramount Resources is profitable and growing, we're not too worried by this. While insiders do own shares, they don't own a heap, and they have been selling. We're in no rush to buy! While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Case in point: We've spotted 2 warning signs for Paramount Resources you should be aware of.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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, but not derivative transactions.

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