Trade Alert: The Independent Director Of Pennine Petroleum Corporation (CVE:PNN), Raymond Gertz, Has Just Spent CA$130k Buying 21% More Shares

By
Simply Wall St
Published
November 24, 2021
TSXV:PNN
Source: Shutterstock

Investors who take an interest in Pennine Petroleum Corporation (CVE:PNN) should definitely note that the Independent Director, Raymond Gertz, recently paid CA$0.03 per share to buy CA$130k worth of the stock. That's a very decent purchase to our minds and it grew their holding by a solid 21%.

See our latest analysis for Pennine Petroleum

The Last 12 Months Of Insider Transactions At Pennine Petroleum

Notably, that recent purchase by Raymond Gertz is the biggest insider purchase of Pennine Petroleum shares that we've seen in the last year. So it's clear an insider wanted to buy, even at a higher price than the current share price (being CA$0.025). Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. 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.

Pennine Petroleum insiders may have bought shares in the last year, but they didn't sell any. 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!

insider-trading-volume
TSXV:PNN Insider Trading Volume November 24th 2021

Pennine Petroleum is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Does Pennine Petroleum 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. 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 25% of Pennine Petroleum shares, worth about CA$1.2m. 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 Pennine Petroleum Insiders?

It's certainly positive to see the recent insider purchases. And an analysis of the transactions over the last year also gives us confidence. But we don't feel the same about the fact the company is making losses. Insiders likely see value in Pennine Petroleum shares, given these transactions (along with notable insider ownership of the company). So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Be aware that Pennine Petroleum is showing 6 warning signs in our investment analysis, and 5 of those are significant...

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, but not derivative transactions.

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.

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