Yahoo Finance Bullish insiders at Melcor Developments Ltd. (TSE:MRD) loaded up on CA$1.4m of stock earlier this year
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 Melcor Developments Ltd. (TSE:MRD), 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 do think it is perfectly logical to keep tabs on what insiders are doing.
See our latest analysis for Melcor Developments
Melcor Developments Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when CEO & Executive Chairman Timothy Melton bought CA$317k worth of shares at a price of CA$14.54 per share. That implies that an insider found the current price of CA$14.69 per share to be enticing. 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. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. In this case we're pleased to report that the insider purchases were made at close to current prices.
Happily, we note that in the last year insiders paid CA$1.4m for 105.64k shares. But insiders sold 8.49k shares worth CA$113k. In total, Melcor Developments insiders bought more than they sold over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
Melcor Developments is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Melcor Developments Insiders Bought Stock Recently
There has been significantly more insider buying, than selling, at Melcor Developments, over the last three months. We can see that Director Andrew Melton paid CA$116k for shares in the company. But we did see Vice-President of Red Deer Region Guy Pelletier sell shares worth CA$2.2k. We think insiders may be optimistic about the future, since insiders have been net buyers of shares.
Does Melcor Developments Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. It appears that Melcor Developments insiders own 12% of the company, worth about CA$57m. 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 Melcor Developments Tell Us?
It is good to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. Given that insiders also own a fair bit of Melcor Developments we think they are probably pretty confident of a bright future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To help with this, we've discovered 4 warning signs (2 are potentially serious!) that you ought to be aware of before buying any shares in Melcor Developments.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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. 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.
