Yahoo Finance Multiple insiders bought Caribbean Utilities Company, Ltd. (TSE:CUP.U) stock earlier this year, a positive sign for shareholders
Usually, when one insider buys stock, it might not be a monumental event. But when multiple insiders are buying like they did in the case of Caribbean Utilities Company, Ltd. (TSE:CUP.U), that sends out a positive message to the company's shareholders.
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.
See our latest analysis for Caribbean Utilities Company
The Last 12 Months Of Insider Transactions At Caribbean Utilities Company
In the last twelve months, the biggest single purchase by an insider was when insider David Ritch bought US$63k worth of shares at a price of US$14.99 per share. That means that even when the share price was higher than US$13.75 (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. We always take careful note of the price insiders pay when purchasing 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.
While Caribbean Utilities Company insiders bought shares during the last year, they didn't sell. 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!
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).
Does Caribbean Utilities Company Boast High Insider Ownership?
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. From looking at our data, insiders own US$3.0m worth of Caribbean Utilities Company stock, about 0.6% of the company. We consider this fairly low insider ownership.
So What Does This Data Suggest About Caribbean Utilities Company Insiders?
It doesn't really mean much that no insider has traded Caribbean Utilities Company shares in the last quarter. However, our analysis of transactions over the last year is heartening. We'd like to see bigger individual holdings. However, we don't see anything to make us think Caribbean Utilities Company insiders are doubting the company. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Our analysis shows 2 warning signs for Caribbean Utilities Company (1 makes us a bit uncomfortable!) and we strongly recommend you look at them before investing.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.
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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.
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