Yahoo Finance The Chief Executive Officer of ARC Resources Ltd. (TSE:ARX), Terry Anderson, Just Bought 23% More Shares
Even if it's not a huge purchase, we think it was good to see that Terry Anderson, the Chief Executive Officer of ARC Resources Ltd. (TSE:ARX) recently shelled out CA$140k to buy stock, at CA$2.80 per share. While we're hesitant to get too excited about a purchase of that size, we do note it increased their holding by a solid 23%.
See our latest analysis for ARC Resources
The Last 12 Months Of Insider Transactions At ARC Resources
Independent Director Frederick Dyment made the biggest insider purchase in the last 12 months. That single transaction was for CA$364k worth of shares at a price of CA$7.30 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being CA$3.42). 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. To us, it's very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
Happily, we note that in the last year insiders paid CA$1.4m for 241.91k shares. But they sold 40000 shares for CA$233k. In total, ARC Resources insiders bought more than they sold over the last year. Their average price was about CA$5.85. These transactions suggest that insiders have considered the current price attractive. You can see the insider transactions (by individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
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.
Does ARC Resources Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Our data indicates that ARC Resources insiders own about CA$8.4m worth of shares (which is 0.7% of the company). Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!
What Might The Insider Transactions At ARC Resources Tell Us?
It's certainly positive to see the recent insider purchases. 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. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that ARC Resources insiders are expecting 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. For example - ARC Resources has 2 warning signs we think you should be aware of.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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 editorial-team@simplywallst.com. 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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