Yahoo Finance Whitecap Resources Inc. (TSE:WCP) Insiders Increased Their Holdings
It is not uncommon to see companies perform well in the years after insiders buy shares. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So before you buy or sell Whitecap Resources Inc. (TSE:WCP), you may well want to know whether insiders have been buying or selling.
What Is Insider Selling?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, such insiders must disclose their trading activities, and not trade on inside information.
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. For example, a Colombia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
View our latest analysis for Whitecap Resources
The Last 12 Months Of Insider Transactions At Whitecap Resources
In the last twelve months, the biggest single sale by an insider was when President Grant Fagerheim sold CA$877k worth of shares at a price of CA$8.77 per share. That is hardly a positive sign, even though it took place above the latest price (CA$4.54). So it may not tell us anything about how insiders feel about the current share price. Notably Grant Fagerheim was also the biggest buyer, having purchased CA$2.1m worth of shares.
In the last twelve months insiders purchased 318.63k shares for CA$2.1m. But they sold 183.22k for CA$1.6m. In the last twelve months there was more buying than selling by Whitecap Resources insiders. They paid about CA$6.67 on average. These transactions suggest that insiders have considered the current price of CA$4.54 attractive. The chart below shows insider transactions over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Whitecap Resources is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Whitecap Resources Insiders Bought Stock Recently
At Whitecap Resources,over the last quarter, we have observed quite a lot more insider buying than insider selling. 7 insiders bought CA$677k worth of shares. On the other hand, Grant Fagerheim netted CA$103k by selling. We think insiders may be optimistic about the future, since insiders have been net buyers of shares.
Does Whitecap Resources Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Whitecap Resources insiders own 1.8% of the company, currently worth about CA$34m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Does This Data Suggest About Whitecap Resources Insiders?
It’s certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. But on the other hand, the company made a loss last year, which makes us a little cautious. Given that insiders also own a fair bit of Whitecap Resources we think they are probably pretty confident of a bright future. Of course, the future is what matters most. So if you are interested in Whitecap Resources, you should check out this free report on analyst forecasts for the company.
But note: Whitecap Resources 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.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
