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Read This Before Selling National Bank of Canada (TSE:NA) Shares

Simply Wall St

We often see insiders buying up shares in companies that perform well over the long term. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So shareholders might well want to know whether insiders have been buying or selling shares in National Bank of Canada (TSE:NA).

What Is Insider Selling?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, rules govern insider transactions, and certain disclosures are required.

We don't think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.

Check out our latest analysis for National Bank of Canada

The Last 12 Months Of Insider Transactions At National Bank of Canada

In the last twelve months, the biggest single purchase by an insider was when Independent Director Lino Saputo bought CA$1.8m worth of shares at a price of CA$58.50 per share. That means that an insider was happy to buy shares at around the current price of CA$67.47. 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. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. Happily, the National Bank of Canada insiders decided to buy shares at close to current prices.

While National Bank of Canada insiders bought shares last year, they didn't sell. You can see the insider transactions (by individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

TSX:NA Recent Insider Trading, October 28th 2019

National Bank of Canada is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

National Bank of Canada Insiders Bought Stock Recently

We saw some National Bank of Canada insider buying shares in the last three months. Independent Director Raymond Bachand bought CA$34k worth of shares in that time. It's great to see that insiders are only buying, not selling. However, in this case the amount invested recently is quite small.

Does National Bank of Canada 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. We usually like to see fairly high levels of insider ownership. It appears that National Bank of Canada insiders own 0.2% of the company, worth about CA$43m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The National Bank of Canada Insider Transactions Indicate?

We note a that there has been a bit of insider buying recently (but no selling). That said, the purchases were not large. But insiders have shown more of an appetite for the stock, over the last year. Insiders do have a stake in National Bank of Canada and their transactions don't cause us concern. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for National Bank of Canada.

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.

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.

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. Thank you for reading.