Don't Ignore The Insider Selling In TerraVest Industries

Some TerraVest Industries Inc. (TSE:TVK) shareholders may be a little concerned to see that the President of Compressed Gas Equipment Division, Mitchell Debelser, recently sold a substantial CA$770k worth of stock at a price of CA$77.04 per share. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 2.5%.

Check out our latest analysis for TerraVest Industries

The Last 12 Months Of Insider Transactions At TerraVest Industries

The President of Diamond Energy Services Limited Partnership, Michael Gering, made the biggest insider sale in the last 12 months. That single transaction was for CA$1.1m worth of shares at a price of CA$29.31 each. That means that an insider was selling shares at slightly below the current price (CA$78.61). When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. It is worth noting that this sale was 85% of Michael Gering's holding.

Over the last year, we can see that insiders have bought 1.24k shares worth CA$72k. But insiders sold 64.65k shares worth CA$3.0m. All up, insiders sold more shares in TerraVest Industries than they bought, over the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

Does TerraVest Industries Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. TerraVest Industries insiders own about CA$356m worth of shares (which is 23% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Do The TerraVest Industries Insider Transactions Indicate?

The stark truth for TerraVest Industries is that there has been more insider selling than insider buying in the last three months. Zooming out, the longer term picture doesn't give us much comfort. But it is good to see that TerraVest Industries is growing earnings. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing TerraVest Industries. To assist with this, we've discovered 3 warning signs that you should run your eye over to get a better picture of TerraVest Industries.

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 of direct interests only, but not derivative transactions or indirect interests.

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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.