We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in CanWel Building Materials Group Ltd. (TSE:CWX).
What Is Insider Buying?
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 don't think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. 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.
The Last 12 Months Of Insider Transactions At CanWel Building Materials Group
In the last twelve months, the biggest single purchase by an insider was when President & Director Marc Séguin bought CA$169k worth of shares at a price of CA$4.34 per share. Even though the purchase was made at a significantly lower price than the recent price (CA$5.71), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.
Happily, we note that in the last year insiders paid CA$671k for 140.66k shares. But insiders sold 72275 shares worth CA$323k. In total, CanWel Building Materials Group insiders bought more than they sold over the last year. The chart below shows insider transactions (by individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
CanWel Building Materials Group Insiders Bought Stock Recently
Over the last quarter, CanWel Building Materials Group insiders have spent a meaningful amount on shares. Not only was there no selling that we can see, but they collectively bought CA$319k worth of shares. This makes one think the business has some good points.
Insider Ownership of CanWel Building Materials Group
Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 1.7% of CanWel Building Materials Group shares, worth about CA$7.5m, according to our data. We do generally prefer see higher levels of insider ownership.
So What Do The CanWel Building Materials Group Insider Transactions Indicate?
It is good to see recent purchasing. 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 CanWel Building Materials Group insiders are expecting a bright future. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
But note: CanWel Building Materials Group 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.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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. Simply Wall St has no position in the stocks mentioned.
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