Yahoo Finance Read This Before Selling EnerDynamic Hybrid Technologies Corp. (CVE:EHT) Shares
It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in EnerDynamic Hybrid Technologies Corp. (CVE:EHT).
What Is Insider Buying?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, such insiders must disclose their trading activities, and not trade on inside information.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year.
View our latest analysis for EnerDynamic Hybrid Technologies
The Last 12 Months Of Insider Transactions At EnerDynamic Hybrid Technologies
Independent Director David Woolford made the biggest insider purchase in the last 12 months. That single transaction was for CA$180k worth of shares at a price of CA$0.05 each. That means that an insider was happy to buy shares at above the current price of CA$0.03. 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. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. David Woolford was the only individual insider to buy over the year.
David Woolford bought 6.18m shares over the last 12 months at an average price of CA$0.044. The chart below shows insider transactions (by individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
EnerDynamic Hybrid Technologies is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insider Ownership of EnerDynamic Hybrid Technologies
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. It appears that EnerDynamic Hybrid Technologies insiders own 17% of the company, worth about CA$1.8m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At EnerDynamic Hybrid Technologies Tell Us?
The fact that there have been no EnerDynamic Hybrid Technologies insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. Insiders do have a stake in EnerDynamic Hybrid Technologies and their transactions don't cause us concern. To put this in context, take a look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow.
But note: EnerDynamic Hybrid Technologies 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.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.
