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We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell Nerds on Site Inc. (CNSX:NERD), you may well want to know whether insiders have been buying or selling.
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, most countries require that the company discloses such transactions to the market.
Insider transactions are not the most important thing when it comes to long-term investing. 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.'
Nerds on Site Insider Transactions Over The Last Year
In the last twelve months, the biggest single sale by an insider was when the , John Harbarenko, sold CA$133k worth of shares at a price of CA$0.21 per share. That means that an insider was selling shares at around the current price of CA$0.19. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. In this case, the big sale took place at around the current price, so it's not too bad (but it's still not a positive). The only individual insider seller over the last year was John Harbarenko.
Happily, we note that in the last year insiders paid CA$53k for 233k shares. But insiders sold 708k shares worth CA$133k. 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!
If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).
Does Nerds on Site Boast High Insider Ownership?
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Based on our data, Nerds on Site insiders have about 2.9% of the stock, worth approximately CA$471k. However, it's possible that insiders might have an indirect interest through a more complex structure. We prefer to see high levels of insider ownership.
What Might The Insider Transactions At Nerds on Site Tell Us?
It doesn't really mean much that no insider has traded Nerds on Site shares in the last quarter. Our analysis of Nerds on Site insider transactions leaves us unenthusiastic. And we're not picking up on high enough insider ownership to give us any comfort. Along with insider transactions, I recommend checking if Nerds on Site is growing revenue. This free chart of historic revenue and earnings should make that easy.
Of course Nerds on Site may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body.
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 email@example.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.