Independent Director Leslie Biddle Just Bought 262% More Shares In CenterPoint Energy, Inc. (NYSE:CNP)

CenterPoint Energy, Inc. (NYSE:CNP) shareholders (or potential shareholders) will be happy to see that the Independent Director, Leslie Biddle, recently bought a whopping US$992k worth of stock, at a price of US$19.84. That increased their holding by a full 262%, which arguably implies the sort of confidence required for a shy sweet-natured nerd to ask the most popular kid in the school to go out on a date.

Check out our latest analysis for CenterPoint Energy

The Last 12 Months Of Insider Transactions At CenterPoint Energy

Notably, that recent purchase by Leslie Biddle is the biggest insider purchase of CenterPoint Energy shares that we've seen in the last year. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$19.45). 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. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

In the last twelve months CenterPoint Energy insiders were buying shares, but not selling. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

CenterPoint Energy is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership of CenterPoint Energy

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. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that CenterPoint Energy insiders own 0.2% of the company, worth about US$24m. 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 CenterPoint Energy Insider Transactions Indicate?

It is good to see recent purchasing. And the longer term insider transactions also give us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. When combined with notable insider ownership, these factors suggest CenterPoint Energy insiders are well aligned, and that they may think the share price is too low. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Case in point: We've spotted 4 warning signs for CenterPoint Energy you should be aware of, and 1 of them shouldn't be ignored.

But note: CenterPoint Energy 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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