Usually, when one insider buys stock, it might not be a monumental event. But when multiple insiders are buying like they did in the case of MGE Energy, Inc. (NASDAQ:MGEE), that sends out a positive message to the company's 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.
The Last 12 Months Of Insider Transactions At MGE Energy
In the last twelve months, the biggest single purchase by an insider was when Independent Director James Berbee bought US$80k worth of shares at a price of US$74.86 per share. That implies that an insider found the current price of US$82.55 per share to be enticing. Of course they may have changed their mind. But this suggests they are optimistic. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. The good news for MGE Energy share holders is that insiders were buying at near the current price.
While MGE Energy insiders bought shares during the last year, they didn't sell. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
MGE Energy Insiders Bought Stock Recently
Over the last three months, we've seen significant insider buying at MGE Energy. In total, insiders bought US$118k worth of shares in that time, and we didn't record any sales whatsoever. This could be interpreted as suggesting a positive outlook.
Does MGE Energy 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. From our data, it seems that MGE Energy insiders own 0.2% of the company, worth about US$5.6m. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!
So What Do The MGE Energy Insider Transactions Indicate?
It's certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that MGE Energy insiders are expecting a bright future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing MGE Energy. Case in point: We've spotted 2 warning signs for MGE Energy you should be aware of.
Of course MGE Energy may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
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.