Favourable Signals For Prime Drink Group: Numerous Insiders Acquired Stock

When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in Prime Drink Group Corp.'s (CSE:PRME) instance, it's good news for shareholders.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

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Prime Drink Group Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by insider Garry Turpin for CA$400k worth of shares, at about CA$0.17 per share. That means that even when the share price was higher than CA$0.15 (the recent price), an insider wanted to purchase shares. 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. We always take careful note of the price insiders pay when purchasing shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

In the last twelve months insiders purchased 3.83m shares for CA$656k. But insiders sold 90.00k shares worth CA$19k. In total, Prime Drink Group insiders bought more than they sold over the last year. 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!

Check out our latest analysis for Prime Drink Group

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Insiders At Prime Drink Group Have Bought Stock Recently

Over the last three months, we've seen significantly more insider buying, than insider selling, at Prime Drink Group. Insiders spent CA$656k on shares. But we did see Independent Director Samuel Cousineau-Bourgeois sell shares worth CA$19k. We think insiders may be optimistic about the future, since insiders have been net buyers of shares.

Does Prime Drink Group Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 9.8% of Prime Drink Group shares, worth about CA$5.4m, according to our data. However, it's possible that insiders might have an indirect interest through a more complex structure. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!

What Might The Insider Transactions At Prime Drink Group Tell Us?

The recent insider purchases are heartening. And the longer term insider transactions also give us confidence. But we don't feel the same about the fact the company is making losses. While the overall levels of insider ownership are below what we'd like to see, the history of transactions imply that Prime Drink Group insiders are reasonably well aligned, and optimistic for 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. At Simply Wall St, we've found that Prime Drink Group has 3 warning signs (2 are concerning!) that deserve your attention before going any further with your analysis.

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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 of direct interests only, but not derivative transactions or indirect interests.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.