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We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So we’ll take a look at whether insiders have been buying or selling shares in Pine Cliff Energy Ltd. (TSE:PNE).
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, most countries require that the company discloses such transactions to the market.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. 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.’
Pine Cliff Energy Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Robert Disbrow bought CA$305k worth of shares at a price of CA$0.30 per share. So it’s clear an insider wanted to buy, even at a higher price. 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. It’s not at all bad to see insiders buy shares at or above current prices. Notably Robert Disbrow was also the biggest seller, having sold CA$474k worth of shares.
Happily, we note that in the last year insiders paid CA$1.3m for 4.43m shares. But insiders sold 1.70m shares worth CA$474k. In total, Pine Cliff Energy insiders bought more than they sold over the last year. They paid about CA$0.28 on average. This is nice to see since it implies that insiders might see value around current prices (around CA$0.26). 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.
Pine Cliff Energy Insiders Bought Stock Recently
At Pine Cliff Energy,over the last quarter, we have observed quite a lot more insider buying than insider selling. In total, 3 insiders bought CA$700k worth of shares in that time. But Robert Disbrow sold shares worth CA$451k. We think insiders may be optimistic about the future, since insiders have been net buyers of shares.
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 Pine Cliff Energy insiders own 21% of the company, worth about CA$17m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Do The Pine Cliff Energy Insider Transactions Indicate?
It is good to see recent purchasing. And the longer term insider transactions also give us confidence. But we don’t feel the same about the fact the company is making losses. When combined with notable insider ownership, these factors suggest Pine Cliff Energy insiders are well aligned, and that they may think the share price is too low. Of course, the future is what matters most. So if you are interested in Pine Cliff Energy, you should check out this free report on analyst forecasts for the company.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at email@example.com.