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Should You Take Comfort From Insider Transactions At TSO3 Inc. (TSE:TOS)?

Jenifer Prater

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We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. 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 shareholders might well want to know whether insiders have been buying or selling shares in TSO3 Inc. (TSE:TOS).

What Is Insider Buying?

It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.

We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Columbia 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 TSO3

TSO3 Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by President Richard Rumble for CA$88k worth of shares, at about CA$0.83 per share. So it’s clear an insider wanted to buy, even at a higher price. 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. That purchase may suggest an expectation of positive returns over the long term.

Happily, we note that in the last year insiders bought 288.40k shares for a total of CA$236k. In total, TSO3 insiders bought more than they sold over the last year. The average buy price was around CA$0.82. I’d consider this a positive as it suggests insiders see value at around the current price, which is CA$0.48. The chart below shows insider transactions (by individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

TSX:TOS Recent Insider Trading, February 22nd 2019

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

Does TSO3 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. Our data suggests TSO3 insiders own 1.4% of the company, worth about CA$650k. We consider this fairly low insider ownership.

What Might The Insider Transactions At TSO3 Tell Us?

It doesn’t really mean much that no insider has traded TSO3 shares in the last quarter. However, our analysis of transactions over the last year is heartening. The transactions are fine but it’d be more encouraging if TSO3 insiders bought more shares in the company. Of course, the future is what matters most. So if you are interested in TSO3, you should check out this free report on analyst forecasts for the company.

Of course TSO3 may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

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.