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Investors who take an interest in NextEra Energy, Inc. (NYSE:NEE) should definitely note that the Independent Director, Naren Gursahaney, recently paid US$73.62 per share to buy US$147k worth of the stock. Although the purchase only increased their holding by 5.9%, it is still a solid purchase in our view.
NextEra Energy Insider Transactions Over The Last Year
In fact, the recent purchase by Naren Gursahaney was the biggest purchase of NextEra Energy shares made by an insider individual in the last twelve months, according to our records. That means that even when the share price was higher than US$72.51 (the recent price), an insider wanted to purchase shares. 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. Generally speaking, it catches our eye when an insider has purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. Naren Gursahaney was the only individual insider to buy during the last year.
You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. 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).
Insider Ownership of NextEra Energy
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. NextEra Energy insiders own about US$199m worth of shares (which is 0.1% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
What Might The Insider Transactions At NextEra Energy Tell Us?
It is good to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. Once you factor in the high insider ownership, it certainly seems like insiders are positive about NextEra Energy. One for the watchlist, at least! 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. Our analysis shows 2 warning signs for NextEra Energy (1 is potentially serious!) and we strongly recommend you look at them before investing.
But note: NextEra Energy 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.
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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.