Stock Analysis

dentalcorp Holdings Ltd. (TSE:DNTL) up 5.8%, but insiders are still down 18% after purchasing CA$796k of stock last year

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Insiders who purchased CA$796k worth of dentalcorp Holdings Ltd. (TSE:DNTL) shares over the past year recouped some of their losses after price gained 5.8% last week. The purchase, however, has proven to be a pricey bet, with losses currently totalling CA$142k.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

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The Last 12 Months Of Insider Transactions At dentalcorp Holdings

The Founder Graham Rosenberg made the biggest insider purchase in the last 12 months. That single transaction was for CA$498k worth of shares at a price of CA$10.95 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being CA$8.89). While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. 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.

In the last twelve months dentalcorp Holdings insiders were buying shares, but not selling. 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!

TSX:DNTL Insider Trading Volume March 31st 2023

dentalcorp Holdings 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.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 6.6% of dentalcorp Holdings shares, worth about CA$111m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At dentalcorp Holdings Tell Us?

The fact that there have been no dentalcorp Holdings insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. It would be great to see more insider buying, but overall it seems like dentalcorp Holdings insiders are reasonably well aligned (owning significant chunk of the company's shares) and optimistic for the future. 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. For instance, we've identified 3 warning signs for dentalcorp Holdings (1 is a bit concerning) you should be aware of.

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.

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