Read This Before Selling AgraFlora Organics International Inc. (CSE:AGRA) Shares

We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we'll take a look at whether insiders have been buying or selling shares in AgraFlora Organics International Inc. (CSE:AGRA).

Do Insider Transactions Matter?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. 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 it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year.

See our latest analysis for AgraFlora Organics International

AgraFlora Organics International Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by Chairman & CEO Brandon Boddy for CA$263k worth of shares, at about CA$0.17 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being CA$0.065). 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. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

In the last twelve months insiders purchased 2.85m shares for CA$488k. But insiders sold 150000 shares worth CA$94k. In the last twelve months there was more buying than selling by AgraFlora Organics International insiders. You can see the insider transactions (by 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!

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.

Insiders at AgraFlora Organics International Have Bought Stock Recently

There was some insider buying at AgraFlora Organics International over the last quarter. Insiders bought CA$25k worth of shares in that time. It's great to see that insiders are only buying, not selling. But the amount invested in the last three months isn't enough for us too put much weight on it, as a single factor.

Does AgraFlora Organics International Boast High 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. From looking at our data, insiders own CA$785k worth of AgraFlora Organics International stock, about 1.2% of the company. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. We consider this fairly low insider ownership.

So What Does This Data Suggest About AgraFlora Organics International Insiders?

We note a that there has been a bit of insider buying recently (but no selling). The net investment is not enough to encourage us much. But insiders have shown more of an appetite for the stock, over the last year. While we have no worries about the insider transactions, we'd be more comfortable if they owned more AgraFlora Organics International stock. 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. Every company has risks, and we've spotted 5 warning signs for AgraFlora Organics International (of which 2 don't sit too well with us!) you should know about.

But note: AgraFlora Organics International 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.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.