The recent price decline of 3.8% in goeasy Ltd.'s (TSE:GSY) stock may have disappointed insiders who bought CA$1.4m worth of shares at an average price of CA$150 in the past 12 months. Insiders purchase with the hope of seeing their investments increase in value over time. However, due to recent losses, their initial investment is now only worth CA$1.1m, which is not great.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.
The Last 12 Months Of Insider Transactions At goeasy
Over the last year, we can see that the biggest insider purchase was by Independent Director David Appel for CA$504k worth of shares, at about CA$126 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being CA$119). 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. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
In the last twelve months insiders purchased 9.39k shares for CA$1.4m. But insiders sold 2.00k shares worth CA$420k. In the last twelve months there was more buying than selling by goeasy insiders. The average buy price was around CA$150. This is nice to see since it implies that insiders might see value around current prices. 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 always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
goeasy Insiders Bought Stock Recently
There was some insider buying at goeasy over the last quarter. Insiders bought CA$28k worth of shares in that time. It's good to see the insider buying, as well as the lack of recent sellers. But in this case the amount purchased means the recent transaction may not be very meaningful on its own.
Does goeasy 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. goeasy insiders own about CA$422m worth of shares (which is 22% of the company). 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 goeasy Insiders?
Our data shows a little insider buying, but no selling, in the last three months. The net investment is not enough to encourage us much. But insiders have shown more of an appetite for the stock, over the last year. It would be great to see more insider buying, but overall it seems like goeasy insiders are reasonably well aligned (owning significant chunk of the company's shares) and optimistic for the future. 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. Our analysis shows 4 warning signs for goeasy (2 can't be ignored!) and we strongly recommend you look at these before investing.
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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