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Insiders who bought CA$253k worth of Fire & Flower Holdings Corp.'s (TSE:FAF) stock at an average buy price of CA$5.39 over the last year may be disappointed by the recent 13% decrease in the stock. Insiders invest with the hopes of seeing their money grow in value over time. However, as a result of recent losses, their initial investment is now only worth CA$115k, which is not what they expected.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
The Last 12 Months Of Insider Transactions At Fire & Flower Holdings
Over the last year, we can see that the biggest insider purchase was by Chief Financial Officer Judy Adam for CA$110k worth of shares, at about CA$5.79 per share. That means that an insider was happy to buy shares at above the current price of CA$2.44. It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
Happily, we note that in the last year insiders paid CA$253k for 47.00k shares. On the other hand they divested 40.00k shares, for CA$75k. In total, Fire & Flower Holdings insiders bought more than they sold over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Fire & Flower Holdings 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.
Insiders at Fire & Flower Holdings Have Sold Stock Recently
The last three months saw significant insider selling at Fire & Flower Holdings. In total, insider Brian Hannasch dumped CA$75k worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Our data suggests Fire & Flower Holdings insiders own 4.0% of the company, worth about CA$4.4m. We consider this fairly low insider ownership.
So What Does This Data Suggest About Fire & Flower Holdings Insiders?
An insider hasn't bought Fire & Flower Holdings stock in the last three months, but there was some selling. But we take heart from prior transactions. Still, insiders don't own a great deal of the stock. So the company doesn't look great on this analysis. 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 instance, we've identified 6 warning signs for Fire & Flower Holdings (1 is a bit concerning) 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.
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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.