How Many FSD Pharma Inc. (CSE:HUGE) Shares Did Insiders Buy, In The Last Year?

We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. 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 FSD Pharma Inc. (CSE:HUGE).

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 logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year'.

See our latest analysis for FSD Pharma

The Last 12 Months Of Insider Transactions At FSD Pharma

The Executive Chairman & CEO Raza Bokhari made the biggest insider purchase in the last 12 months. That single transaction was for CA$2.5m worth of shares at a price of CA$3.10 each. That implies that an insider found the current price of CA$3.65 per share to be enticing. That means they have been optimistic about the company in the past, though they may have changed their mind. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. Happily, the FSD Pharma insiders decided to buy shares at close to current prices.

Happily, we note that in the last year insiders paid CA$7.0m for 2.14m shares. On the other hand they divested 9.61k shares, for CA$35k. In the last twelve months there was more buying than selling by FSD Pharma insiders. 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!

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

Does FSD Pharma Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Insiders own 11% of FSD Pharma shares, worth about CA$11m, according to our data. We do generally prefer see higher levels of insider ownership.

So What Do The FSD Pharma Insider Transactions Indicate?

There haven't been any insider transactions in the last three months -- that doesn't mean much. On a brighter note, the transactions over the last year are encouraging. Insiders own shares in FSD Pharma and we see no evidence to suggest they are worried about the future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To that end, you should learn about the 6 warning signs we've spotted with FSD Pharma (including 3 which shouldn't be ignored).

But note: FSD Pharma 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. 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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