Need To Know: The Green Organic Dutchman Holdings Ltd. (TSE:TGOD) Insiders Have Been Selling Shares
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It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we'll take a look at whether insiders have been buying or selling shares in The Green Organic Dutchman Holdings Ltd. (TSE:TGOD).
What Is Insider Selling?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, such insiders must disclose their trading activities, and not trade on inside information.
We don't think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Columbia University study found that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.
See our latest analysis for Green Organic Dutchman Holdings
Green Organic Dutchman Holdings Insider Transactions Over The Last Year
In the last twelve months, the biggest single sale by an insider was when the Director, Marc Bertrand, sold CA$2.9m worth of shares at a price of CA$4.91 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The silver lining is that this sell-down took place above the latest price (CA$3.91). So it is hard to draw any strong conclusion from it.
Over the last year, we can see that insiders have bought 164k shares worth CA$540k. On the other hand they divested 2.0m shares, for CA$12m. Over the last year we saw more insider selling of Green Organic Dutchman Holdings shares, than buying. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Green Organic Dutchman Holdings Insiders Are Selling The Stock
Over the last three months, we've seen notably more insider selling, than insider buying, at Green Organic Dutchman Holdings. In total, insiders sold CA$4.0m worth of shares in that time. On the flip side, Chief Financial Officer Sean Bovingdon spent CA$22k on purchasing shares. Since the selling really does outweigh the buying, we'd say that these transactions may suggest that some insiders feel the company has been fully valued in recent months.
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. Insiders own 2.4% of Green Organic Dutchman Holdings shares, worth about CA$26m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
What Might The Insider Transactions At Green Organic Dutchman Holdings Tell Us?
The insider sales have outweighed the insider buying, at Green Organic Dutchman Holdings, in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. While insiders do own shares, they don't own a heap, and they have been selling. We're in no rush to buy! Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Green Organic Dutchman Holdings.
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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
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.
