Read This Before Selling PHX Energy Services Corp. (TSE:PHX) Shares
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 PHX Energy Services Corp. (TSE:PHX).
What Is Insider Buying?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, rules govern insider transactions, and certain disclosures are required.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But equally, we would consider it foolish to ignore insider transactions altogether. 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’.
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The Last 12 Months Of Insider Transactions At PHX Energy Services
In the last twelve months, the biggest single purchase by an insider was when Chairman & CEO John Hooks bought CA$239k worth of shares at a price of CA$1.89 per share. Although we like to see insider buying, we note that this large purchase was at significantly lower prices. The purchase might not be the best indicator of confidence in the current valuation.
In the last twelve months insiders paid CA$570k for 282.80k shares purchased. In total, PHX Energy Services insiders bought more than they sold over the last year. They paid about CA$2.02 on average. Although they bought at below the recent price of CA$2.52 per share, it is good to see that insiders are willing to invest in the company. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
PHX Energy Services Insiders Bought Stock Recently
We saw some PHX Energy Services insider buying shares in the last three months. Insiders purchased CA$65k worth of shares in that period. We like it when there are only buyers, and no sellers. But the amount invested in the last three months isn’t enough for us too put much weight on it, as a single factor.
Insider Ownership of PHX Energy Services
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. PHX Energy Services insiders own about CA$23m worth of shares. That equates to 16% of the company. 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 PHX Energy Services Tell Us?
It’s certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. However, we note that the company didn’t make a profit over the last twelve months, which makes us cautious. Given that insiders also own a fair bit of PHX Energy Services we think they are probably pretty confident of a bright future. Of course, the future is what matters most. So if you are interested in PHX Energy Services, you should check out this free report on analyst forecasts for the company.
Of course PHX Energy Services may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
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 editorial-team@simplywallst.com.
