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Those following along with Canadian National Railway Company (TSE:CNR) will no doubt be intrigued by the recent purchase of shares by Robert Pace, Independent Chairman of the Board of the company, who spent a stonking CA$7.6m on stock at an average price of CA$153. Aside from being a solid chunk in its own right, the deft move also saw their holding increase by some 24%.
Canadian National Railway Insider Transactions Over The Last Year
Notably, that recent purchase by Robert Pace is the biggest insider purchase of Canadian National Railway shares that we've seen in the last year. That means that even when the share price was higher than CA$147 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
In the last twelve months insiders purchased 71.41k shares for CA$10m. On the other hand they divested 23.45k shares, for CA$3.3m. In the last twelve months there was more buying than selling by Canadian National Railway insiders. 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!
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.
Insider Ownership of Canadian National Railway
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Canadian National Railway insiders own 3.6% of the company, currently worth about CA$3.7b based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
What Might The Insider Transactions At Canadian National Railway Tell Us?
The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. When combined with notable insider ownership, these factors suggest Canadian National Railway insiders are well aligned, and quite possibly think the share price is too low. Looks promising! While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For example - Canadian National Railway has 1 warning sign we think you should be aware of.
But note: Canadian National Railway 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.
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.
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