Insider Stock Buying Reaches CA$2.32m On Roots
When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in Roots Corporation's (TSE:ROOT) instance, it's good news for shareholders.
Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.
Check out our latest analysis for Roots
The Last 12 Months Of Insider Transactions At Roots
In fact, the recent purchase by insider Edward Kernaghan was not their only acquisition of Roots shares this year. They previously made an even bigger purchase of CA$527k worth of shares at a price of CA$3.03 per share. That means that an insider was happy to buy shares at above the current price of CA$2.40. Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
Roots insiders may have bought shares in the last year, but they didn't sell any. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Roots is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insiders At Roots Have Bought Stock Recently
Over the last three months, we've seen significant insider buying at Roots. We can see that insider Edward Kernaghan paid CA$475k for shares in the company. No-one sold. This is a positive in our book as it implies some confidence.
Does Roots Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Our data indicates that Roots insiders own about CA$13m worth of shares (which is 14% of the company). Whilst better than nothing, we're not overly impressed by these holdings.
So What Does This Data Suggest About Roots Insiders?
It's certainly positive to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. Insiders likely see value in Roots shares, given these transactions (along with notable insider ownership of the company). In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Roots. For example - Roots has 3 warning signs we think you should be aware of.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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 of direct interests only, but not derivative transactions or indirect interests.
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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.
