Are Insiders Buying Northern Oil and Gas, Inc. (NYSEMKT:NOG) Stock?

We often see insiders buying up shares in companies that perform well over the long term. 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 before you buy or sell Northern Oil and Gas, Inc. (NYSEMKT:NOG), you may well want to know whether insiders have been buying or selling.

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.

We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise'.

View our latest analysis for Northern Oil and Gas

The Last 12 Months Of Insider Transactions At Northern Oil and Gas

Over the last year, we can see that the biggest insider purchase was by insider Robert Rowling for US$5.6m worth of shares, at about US$1.70 per share. That means that even when the share price was higher than US$0.72 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. 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.

Northern Oil and Gas insiders may have bought shares in the last year, but they didn't sell any. They paid about US$1.45 on average. I'd consider this a positive as it suggests insiders see value at around the current price. 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!

Northern Oil and Gas is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insiders at Northern Oil and Gas Have Bought Stock Recently

Over the last quarter, Northern Oil and Gas insiders have spent a meaningful amount on shares. Not only was there no selling that we can see, but they collectively bought US$286k worth of shares. This is a positive in our book as it implies some confidence.

Insider Ownership of Northern Oil and Gas

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. Northern Oil and Gas insiders own about US$27m worth of shares. That equates to 8.5% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At Northern Oil and Gas Tell Us?

The recent insider purchases are heartening. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. Insiders likely see value in Northern Oil and Gas shares, given these transactions (along with notable insider ownership of the company). In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Northern Oil and Gas. At Simply Wall St, we found 2 warning signs for Northern Oil and Gas that deserve your attention before buying any shares.

Of course Northern Oil and Gas may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

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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