Northern Oil and Gas Sees Insider Stock Selling

Insiders were net sellers of Northern Oil and Gas, Inc.'s (NYSE:NOG ) stock during the past year. That is, insiders sold more stock than they bought.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Northern Oil and Gas

Northern Oil and Gas Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Independent Chairperson of the Board of Directors, Bahram Akradi, sold US$454k worth of shares at a price of US$37.83 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$43.20. 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. It is worth noting that this sale was only 0.7% of Bahram Akradi's holding. Bahram Akradi was the only individual insider to sell over the last year.

You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

Does Northern Oil and Gas Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with 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. Northern Oil and Gas insiders own about US$122m worth of shares (which is 2.8% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Northern Oil and Gas Insiders?

The fact that there have been no Northern Oil and Gas insider transactions recently certainly doesn't bother us. It's heartening that insiders own plenty of stock, but we'd like to see more insider buying, since the last year of Northern Oil and Gas insider transactions don't fill us with confidence. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Northern Oil and Gas. Every company has risks, and we've spotted 3 warning signs for Northern Oil and Gas (of which 1 is a bit concerning!) you should know about.

But note: Northern Oil and Gas 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 of direct interests only, but not derivative transactions or indirect interests.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.