Allen Hagerman Just Bought A Sprinkling of Shares In TransAlta Corporation (TSE:TA)

Investors who take an interest in TransAlta Corporation (TSE:TA) should definitely note that insider Allen Hagerman recently paid CA$10.20 per share to buy CA$128k worth of the stock. However, it only increased shareholding by a small percentage, and it wasn't a huge purchase by absolute value, either.

Check out our latest analysis for TransAlta

The Last 12 Months Of Insider Transactions At TransAlta

The Chief Development Officer, Brett Gellner, made the biggest insider sale in the last 12 months. That single transaction was for CA$924k worth of shares at a price of CA$9.03 each. That means that an insider was selling shares at slightly below the current price (CA$10.78). 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. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. This single sale was 61% of Brett Gellner's stake.

Over the last year, we can see that insiders have bought 34.70k shares worth CA$303k. But insiders sold 137.32k shares worth CA$1.3m. All up, insiders sold more shares in TransAlta than they bought, over the last year. The average sell price was around CA$9.13. We don't gain confidence from insider selling below the recent share price. But we wouldn't put too much weight on the insider selling. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

I will like TransAlta 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

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. TransAlta insiders own about CA$14m worth of shares. That equates to 0.5% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Do The TransAlta Insider Transactions Indicate?

The insider sales have outweighed the insider buying, at TransAlta, in the last three months. Zooming out, the longer term picture doesn't give us much comfort. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We're in no rush to buy! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing TransAlta. For instance, we've identified 2 warning signs for TransAlta (1 is significant) you should be aware of.

But note: TransAlta 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.

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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