Insider Stock Buying Reaches CA$4.82m On Topaz Energy

In the last year, multiple insiders have substantially increased their holdings of Topaz Energy Corp. (TSE:TPZ) stock, indicating that insiders' optimism about the company's prospects has increased.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for Topaz Energy

Topaz Energy Insider Transactions Over The Last Year

In fact, the recent purchase by Michael Rose was the biggest purchase of Topaz Energy shares made by an insider individual in the last twelve months, according to our records. That means that an insider was happy to buy shares at around the current price of CA$27.21. Of course they may have changed their mind. But this suggests they are optimistic. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. The good news for Topaz Energy share holders is that insiders were buying at near the current price.

In the last twelve months Topaz Energy insiders were buying shares, but not selling. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

Topaz Energy is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Topaz Energy Insiders Bought Stock Recently

Over the last quarter, Topaz Energy insiders have spent a meaningful amount on shares. In total, insiders bought CA$4.4m worth of shares in that time, and we didn't record any sales whatsoever. That shows some optimism about the company's future.

Does Topaz Energy Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Topaz Energy insiders own 4.3% of the company, currently worth about CA$177m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

What Might The Insider Transactions At Topaz Energy Tell Us?

It's certainly positive to see the recent insider purchases. We also take confidence from the longer term picture of insider transactions. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Topaz Energy. Nice! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Topaz Energy. To help with this, we've discovered 2 warning signs (1 shouldn't be ignored!) that you ought to be aware of before buying any shares in Topaz Energy.

But note: Topaz 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.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.