Methanex Corporation (TSE:MX) insiders have a reason to boast after seeing a US$149k addition to their US$958k investment

Methanex Corporation (TSE:MX) insiders who purchased shares in the last 12 months were richly rewarded last week. The stock climbed by 5.4% resulting in a CA$226m addition to the company’s market value. As a result, their original purchase of US$958k worth of stock is now worth US$1.1m.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Methanex

Methanex Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the insider, Vanessa James, sold CA$511k worth of shares at a price of CA$68.15 per share. So what is clear is that an insider saw fit to sell at around the current price of CA$64.19. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign. The only individual insider seller over the last year was Vanessa James.

Happily, we note that in the last year insiders paid CA$958k for 17.25k shares. On the other hand they divested 7.50k shares, for CA$511k. In total, Methanex insiders bought more than they sold over the last year. The average buy price was around CA$55.53. To my mind it is good that insiders have invested their own money in the company. But we must note that the investments were made at well below today's share price. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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

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. Methanex insiders own about CA$38m worth of shares. That equates to 0.9% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At Methanex Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. But insiders have shown more of an appetite for the stock, over the last year. Insiders own shares in Methanex and we see no evidence to suggest they are worried about the future. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. You'd be interested to know, that we found 1 warning sign for Methanex and we suggest you have a look.

But note: Methanex may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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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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.