Favorable turn of events for Magna International Inc. (TSE:MG) insiders who've lost US$304k to date on a US$1.4m purchase
Some of the losses seen by insiders who purchased US$1.4m worth of Magna International Inc. (TSE:MG) shares over the past year were recovered after the stock increased by 8.3% over the past week. However, total losses seen by insiders are still US$304k but in since the time of purchase.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
View our latest analysis for Magna International
The Last 12 Months Of Insider Transactions At Magna International
The President Vincent Galifi made the biggest insider purchase in the last 12 months. That single transaction was for CA$980k worth of shares at a price of CA$103 each. That means that even when the share price was higher than CA$76.40 (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. In our view, the price an insider pays for shares is very important. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
Over the last year, we can see that insiders have bought 14.21k shares worth CA$1.4m. But they sold 9.96k shares for CA$913k. In the last twelve months there was more buying than selling by Magna International insiders. You can see the insider transactions (by companies and 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!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Insiders At Magna International Have Sold Stock Recently
The last quarter saw substantial insider selling of Magna International shares. In total, insider Aaron McCarthy sold CA$251k worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.
Does Magna International Boast High Insider Ownership?
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 0.5% of Magna International shares, worth about CA$104m. 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 Magna International Tell Us?
An insider hasn't bought Magna International stock in the last three months, but there was some selling. But we take heart from prior transactions. We are also comforted by the high levels of insider ownership. So the recent selling doesn't worry us. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Every company has risks, and we've spotted 3 warning signs for Magna International you should know about.
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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