Who Has Been Buying Power Corporation of Canada (TSE:POW) Shares?

It is not uncommon to see companies perform well in the years after insiders buy shares. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So shareholders might well want to know whether insiders have been buying or selling shares in Power Corporation of Canada (TSE:POW).

Do Insider Transactions Matter?

It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, such insiders must disclose their trading activities, and not trade on inside information.

We don't think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia University study found that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.

View our latest analysis for Power Corporation of Canada

Power Corporation of Canada Insider Transactions Over The Last Year

The President Robert Orr made the biggest insider purchase in the last 12 months. That single transaction was for CA$1.1m worth of shares at a price of CA$22.58 each. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of CA$29.89. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

In the last twelve months Power Corporation of Canada 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!

Power Corporation of Canada is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insiders at Power Corporation of Canada Have Bought Stock Recently

It's good to see that Power Corporation of Canada insiders have made notable investments in the company's shares. We can see that Independent Director Pierre Beaudoin paid CA$498k for shares in the company. No-one sold. This could be interpreted as suggesting a positive outlook.

Insider Ownership of Power Corporation of Canada

For a common shareholder, it is worth checking how many shares are held by company 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. Insiders own 0.4% of Power Corporation of Canada shares, worth about CA$80m. 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 Power Corporation of Canada Tell Us?

It's certainly positive to see the recent insider purchase. And the longer term insider transactions also give us confidence. Insiders likely see value in Power Corporation of Canada shares, given these transactions (along with notable insider ownership of the company). In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Power Corporation of Canada. For instance, we've identified 2 warning signs for Power Corporation of Canada (1 can't be ignored) you should be aware of.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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, but not derivative transactions.

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This article by Simply Wall St is general in nature. 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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