Possible Bearish Signals With Vermilion Energy Insiders Disposing Stock

Over the past year, many Vermilion Energy Inc. (TSE:VET) insiders sold a significant stake in the company which may have piqued investors' interest. When evaluating insider transactions, knowing whether insiders are buying is usually more beneficial than knowing whether they are selling, as the latter can be open to many interpretations. However, shareholders should take a deeper look if several insiders are selling stock over a specific time period.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for Vermilion Energy

The Last 12 Months Of Insider Transactions At Vermilion Energy

In the last twelve months, the biggest single sale by an insider was when the insider, Jenson Tan, sold CA$825k worth of shares at a price of CA$16.50 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. It's of some comfort that this sale was conducted at a price well above the current share price, which is CA$14.37. So it may not tell us anything about how insiders feel about the current share price.

In the last twelve months insiders purchased 35.00k shares for CA$529k. But insiders sold 103.40k shares worth CA$1.7m. All up, insiders sold more shares in Vermilion Energy 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!

I will like Vermilion Energy better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Vermilion Energy Insiders Bought Stock Recently

We saw some Vermilion Energy insider buying shares in the last three months. Insiders bought CA$26k worth of shares in that time. It's great to see that insiders are only buying, not selling. But in this case the amount purchased means the recent transaction may not be very meaningful on its own.

Insider Ownership Of Vermilion Energy

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 0.8% of Vermilion Energy shares, worth about CA$19m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The Vermilion Energy Insider Transactions Indicate?

Insider purchases may have been minimal, in the last three months, but there was no selling at all. Overall the buying isn't worth writing home about. Our analysis of Vermilion Energy insider transactions leaves us cautious. But we do like the fact that insiders own a fair chunk of the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Vermilion Energy. At Simply Wall St, we found 1 warning sign for Vermilion Energy that deserve your attention before buying any shares.

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.