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We often see insiders buying up shares in companies that perform well over the long term. 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 Painted Pony Energy Ltd. (TSE:PONY).
Do Insider Transactions Matter?
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, most countries require that the company discloses such transactions to the market.
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 Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.’
Painted Pony Energy Insider Transactions Over The Last Year
There wasn’t any very large single transaction over the last year, but we can still observe some trading.
In the last twelve months insiders paid CA$78k for 45.00k shares purchased. In total, Painted Pony Energy insiders bought more than they sold over the last year. Their average price was about CA$1.72. These transactions suggest that insiders have considered the current price of CA$1.32 attractive. The chart below shows insider transactions (by individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Painted Pony Energy is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insiders at Painted Pony Energy Have Bought Stock Recently
We saw some Painted Pony Energy insider buying shares in the last three months. George Voneiff purchased CA$53k worth of shares in that period. We like it when there are only buyers, and no sellers. But in this case the amount purchased means the recent transaction may not be very meaningful on its own.
Insider Ownership of Painted Pony Energy
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it’s a good sign if insiders own a significant number of shares in the company. Our data suggests Painted Pony Energy insiders own 2.0% of the company, worth about CA$4.5m. We prefer to see high levels of insider ownership.
What Might The Insider Transactions At Painted Pony Energy Tell Us?
It is good to see recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss last year, which makes us a little cautious. While the overall levels of insider ownership are below what we’d like to see, the history of transactions imply that Painted Pony Energy insiders are reasonably well aligned, and optimistic for the future. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Painted Pony Energy.
But note: Painted Pony Energy 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.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at email@example.com.