It is not uncommon to see companies perform well in the years after insiders buy shares. 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 shareholders might well want to know whether insiders have been buying or selling shares in True North Commercial Real Estate Investment Trust (TSE:TNT.UN).
Do Insider Transactions Matter?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.
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 Colombia 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’.
The Last 12 Months Of Insider Transactions At True North Commercial Real Estate Investment Trust
President Daniel Drimmer made the biggest insider purchase in the last 12 months. That single transaction was for CA$798k worth of shares at a price of CA$6.38 each. That means that an insider was happy to buy shares at above the current price. 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. That purchase may suggest an expectation of positive returns over the long term.
Over the last year, we can see that insiders have bought 248.20k shares worth CA$1.6m. In the last twelve months there was more buying than selling by True North Commercial Real Estate Investment Trust insiders. They paid about CA$6.37 on average. This is nice to see since it implies that insiders might see value around current prices (around CA$6.00). The chart below shows insider transactions 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!
I will like True North Commercial Real Estate Investment Trust better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Insider Ownership of True North Commercial Real Estate Investment Trust
For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 7.5% of True North Commercial Real Estate Investment Trust shares, worth about CA$21m. We’ve certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At True North Commercial Real Estate Investment Trust Tell Us?
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. We’d like to see bigger individual holdings. However, we don’t see anything to make us think True North Commercial Real Estate Investment Trust insiders are doubting the company. I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.
But note: True North Commercial Real Estate Investment Trust 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.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at email@example.com.