We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. 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 before you buy or sell CT Real Estate Investment Trust (TSE:CRT.UN), you may well want to know whether insiders have been buying or selling.
What Is Insider Buying?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, rules govern insider transactions, and certain disclosures are required.
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 Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year'.
CT Real Estate Investment Trust Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when insider David Court bought CA$100k worth of shares at a price of CA$13.87 per share. So it's clear an insider wanted to buy, at around the current price, which is CA$15.45. 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. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. The good news for CT Real Estate Investment Trust share holders is that insiders were buying at near the current price.
While CT Real Estate Investment Trust insiders bought shares during the last year, they didn't sell. 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!
CT Real Estate Investment Trust is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Does CT Real Estate Investment Trust Boast High Insider Ownership?
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. Based on our data, CT Real Estate Investment Trust insiders have about 0.08% of the stock, worth approximately CA$2.9m. We prefer to see high levels of insider ownership.
So What Does This Data Suggest About CT Real Estate Investment Trust Insiders?
It doesn't really mean much that no insider has traded CT Real Estate Investment Trust shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. We'd like to see bigger individual holdings. However, we don't see anything to make us think CT Real Estate Investment Trust insiders are doubting the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing CT Real Estate Investment Trust. Be aware that CT Real Estate Investment Trust is showing 2 warning signs in our investment analysis, and 1 of those is concerning...
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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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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