We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. On the other hand, we’d be remiss not to mention that insider sales have been known to precede tough periods for a business. So we’ll take a look at whether insiders have been buying or selling shares in AutoCanada Inc (TSE:ACQ).
What Is Insider Selling?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. 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 AutoCanada
President & Director Michael Rawluk made the biggest insider purchase in the last 12 months. That single transaction was for CA$365k worth of shares at a price of CA$12.07 each. So it’s clear an insider wanted to buy, even at a higher price. Their view may have changed since then, but at least it shows they felt optimistic at the time. We generally consider it a positive if insiders have been buying on market, even above the current price.
In the last twelve months insiders paid CA$1.4m for 110.46k shares purchased. Overall, AutoCanada insiders were net buyers last year. Their average price was about CA$12.38. This is nice to see since it implies that insiders might see value around current prices (around CA$11.72). You can see the insider transactions over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Insiders at AutoCanada Have Bought Stock Recently
Over the last three months, we’ve seen significant insider buying at AutoCanada. Overall, 2 insiders shelled out CA$457k for shares in the company — and none sold. That shows some optimism about the company’s future.
Many investors like to check how much of a company is owned by 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. Based on our data, AutoCanada insiders have about 0.9% of the stock, worth approximately CA$2.3m. We prefer to see high levels of insider ownership.
So What Do The AutoCanada Insider Transactions Indicate?
It is good to see recent purchasing. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss last year, which makes us a little cautious. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that AutoCanada insiders are expecting a bright future. Of course, the future is what matters most. So if you are interested in AutoCanada, you should check out this free report on analyst forecasts for the company.
Of course AutoCanada may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
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 firstname.lastname@example.org.