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 Clean Energy Fuels Corp. (NASDAQ:CLNE).
What Is Insider Selling?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.
Insider transactions are not the most important thing when it comes to long-term investing. 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.’
Clean Energy Fuels Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Co-Founder Andrew Littlefair bought US$50k worth of shares at a price of US$2.30 per share. That means that an insider was happy to buy shares at around the current price. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company’s future. We generally consider it a positive if insiders have been buying on market, even if the share price has increased a bit since then.
In the last twelve months insiders paid US$197k for 84.30k shares purchased. Overall, Clean Energy Fuels insiders were net buyers last year. The average buy price was around US$2.34. These transactions show that insiders have confidence to invest their own money in the stock, albeit at slightly below the recent price of US$2.75. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
I will like Clean Energy Fuels better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Insider Ownership of Clean Energy Fuels
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. Clean Energy Fuels insiders own about US$46m worth of shares. That equates to 8.2% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
What Might The Insider Transactions At Clean Energy Fuels Tell Us?
It doesn’t really mean much that no insider has traded Clean Energy Fuels shares in the last quarter. However, our analysis of transactions over the last year is heartening. Insiders do have a stake in Clean Energy Fuels and their transactions don’t cause us concern. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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