Insiders Give Up CA$73k As Prospera Energy Stock Drops To CA$0.035

Insiders who bought CA$346.4k worth of Prospera Energy Inc.'s (CVE:PEI) stock at an average buy price of CA$0.044 over the last year may be disappointed by the recent 13% decrease in the stock. Insiders buy with the expectation to see their investments rise in value over a period of time. However, recent losses have rendered their above investment worth CA$273.7k which is not ideal.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

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Prospera Energy Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by insider Vittorio Valsecchi for CA$151k worth of shares, at about CA$0.075 per share. That means that an insider was happy to buy shares at above the current price of CA$0.035. 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. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.

In the last twelve months Prospera Energy insiders were buying shares, but not selling. They paid about CA$0.044 on average. These transactions suggest that insiders have considered the current price attractive. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Check out our latest analysis for Prospera Energy

Prospera 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.

Insiders At Prospera Energy Have Bought Stock Recently

It's good to see that Prospera Energy insiders have made notable investments in the company's shares. Overall, four insiders shelled out CA$180k for shares in the company -- and none sold. This makes one think the business has some good points.

Does Prospera Energy Boast High Insider Ownership?

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 40% of Prospera Energy shares, worth about CA$6.0m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Does This Data Suggest About Prospera Energy Insiders?

The recent insider purchases are heartening. We also take confidence from the longer term picture of insider transactions. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Given that insiders also own a fair bit of Prospera Energy we think they are probably pretty confident of a bright future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. When we did our research, we found 3 warning signs for Prospera Energy (2 are potentially serious!) that we believe deserve your full attention.

Of course Prospera Energy may not be the best stock to buy. So you may wish to see this free collection of high quality 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 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.