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It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we'll take a look at whether insiders have been buying or selling shares in DelphX Capital Markets Inc. (CVE:DELX).
Do Insider Transactions Matter?
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.
We don't think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia University study found that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.
DelphX Capital Markets Insider Transactions Over The Last Year
While there weren't any large insider transactions in the last twelve months, it's still worth looking at the trading.
Happily, we note that in the last year insiders paid CA$66k for 715.00k shares. But they sold 150.00k shares for CA$61k. In total, DelphX Capital Markets insiders bought more than they sold over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
DelphX Capital Markets 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.
DelphX Capital Markets Insiders Are Selling The Stock
The last three months saw some DelphX Capital Markets insider selling. CFO & Corporate Secretary Stephen Gledhill sold just CA$61k worth of shares in that time. Neither the lack of buying nor the presence of selling is heartening. But the amount sold isn't enough for us to put any weight on it.
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. It appears that DelphX Capital Markets insiders own 25% of the company, worth about CA$14m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At DelphX Capital Markets Tell Us?
An insider sold stock recently, but they haven't been buying. But we take heart from prior transactions. We like that insiders own a fair amount of the company. So the recent selling doesn't worry us too much. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Be aware that DelphX Capital Markets is showing 5 warning signs in our investment analysis, and 2 of those make us uncomfortable...
Of course DelphX Capital Markets may not be the best stock to buy. So you may wish to see this free collection of high quality 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.
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. 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.
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