Did Genesis Land Development Corp. (TSE:GDC) Insiders Buy Up More 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 shareholders might well want to know whether insiders have been buying or selling shares in Genesis Land Development Corp. (TSE:GDC).

What Is Insider Buying?

It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.

We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But it is perfectly logical to keep tabs on what insiders are doing. 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'.

Check out our latest analysis for Genesis Land Development

The Last 12 Months Of Insider Transactions At Genesis Land Development

The Independent Director, Loudon Frank Owen, made the biggest insider sale in the last 12 months. That single transaction was for CA$2.7m worth of shares at a price of CA$2.11 each. So it's clear an insider wanted to take some cash off the table, even below the current price of CA$2.23. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was 100% of Loudon Frank Owen's stake. The only individual insider seller over the last year was Loudon Frank Owen.

Happily, we note that in the last year insiders paid CA$4.1m for 2.04m shares. But insiders sold 1.27m shares worth CA$2.7m. In total, Genesis Land Development insiders bought more than they sold over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Genesis Land Development is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Genesis Land Development Insiders Bought Stock Recently

At Genesis Land Development,over the last quarter, we have observed quite a lot more insider buying than insider selling. Independent Director Mark Mitchell spent CA$4.1m on stock. But Independent Director Loudon Frank Owen sold shares worth CA$2.7m. Insiders have spent more buying shares than they have selling, so on balance we think they are are probably optimistic.

Does Genesis Land Development 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 20% of Genesis Land Development shares, worth about CA$19m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Genesis Land Development Insiders?

It is good to see the recent insider purchase. And the longer term insider transactions also give us confidence. Insiders likely see value in Genesis Land Development shares, given these transactions (along with notable insider ownership of the company). 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 help with this, we've discovered 4 warning signs (1 doesn't sit too well with us!) that you ought to be aware of before buying any shares in Genesis Land Development.

Of course Genesis Land Development may not be the best stock to buy. So you may wish to see this free collection of high quality 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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