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Potential Parex Resources Inc. (TSE:PXT) shareholders may wish to note that the Lead Independent Director, Robert Engbloom, recently bought CA$426k worth of stock, paying CA$21.31 for each share. We reckon that's a good sign, especially since the purchase boosted their holding by 67%.
Parex Resources Insider Transactions Over The Last Year
Notably, that recent purchase by Robert Engbloom is the biggest insider purchase of Parex Resources shares that we've seen in the last year. That means that an insider was happy to buy shares at around the current price of CA$21.58. That means they have been optimistic about the company in the past, though they may have changed their mind. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. In this case we're pleased to report that the insider purchases were made at close to current prices. Notably Robert Engbloom was also the biggest seller.
In the last twelve months insiders purchased 30.51k shares for CA$559k. But insiders sold 20.49k shares worth CA$377k. Overall, Parex Resources insiders were net buyers during the last year. They paid about CA$18.33 on average. These transactions show that insiders have confidence to invest their own money in the stock, albeit at slightly below the recent price. 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!
Parex Resources is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Does Parex Resources 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. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Parex Resources insiders own 2.3% of the company, worth about CA$64m. 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 Parex Resources Tell Us?
It is good to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. When combined with notable insider ownership, these factors suggest Parex Resources insiders are well aligned, and that they may think the share price is too low. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. While conducting our analysis, we found that Parex Resources has 2 warning signs and it would be unwise to ignore these.
But note: Parex 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.
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.
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. 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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