Are Insiders Buying PrairieSky Royalty Ltd. (TSE:PSK) Stock?
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It is not uncommon to see companies perform well in the years after insiders buy shares. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So we'll take a look at whether insiders have been buying or selling shares in PrairieSky Royalty Ltd. (TSE:PSK).
Do Insider Transactions Matter?
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. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.'
View our latest analysis for PrairieSky Royalty
PrairieSky Royalty Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by President Andrew Phillips for CA$179k worth of shares, at about CA$23.92 per share. That means that even when the share price was higher than CA$18.40 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. 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. Notably Andrew Phillips was also the biggest seller, having sold CA$20k worth of shares.
Happily, we note that in the last year insiders paid CA$483k for 21015 shares. On the other hand they divested 1000 shares, for CA$20k. In total, PrairieSky Royalty insiders bought more than they sold over the last year. You can see the insider transactions (by 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!
PrairieSky Royalty 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.
Does PrairieSky Royalty Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It appears that PrairieSky Royalty insiders own 1.1% of the company, worth about CA$45m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
So What Do The PrairieSky Royalty Insider Transactions Indicate?
It doesn't really mean much that no insider has traded PrairieSky Royalty shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. Insiders own shares in PrairieSky Royalty and we see no evidence to suggest they are worried about the future. Of course, the future is what matters most. So if you are interested in PrairieSky Royalty, you should check out this free report on analyst forecasts for the company.
But note: PrairieSky Royalty 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.
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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.
