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Trade Alert: The CEO & Director Of City Office REIT, Inc. (NYSE:CIO), James Farrar, Has Just Spent US$86k Buying 3.0% More Shares

Simply Wall St
·3 min read

Even if it's not a huge purchase, we think it was good to see that James Farrar, the CEO & Director of City Office REIT, Inc. (NYSE:CIO) recently shelled out US$86k to buy stock, at US$7.48 per share. Although the purchase is not a big one, increasing their shareholding by only 3.0%, it can be interpreted as a good sign.

View our latest analysis for City Office REIT

City Office REIT Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Independent Director John Sweet bought US$113k worth of shares at a price of US$11.29 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$7.28). 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. To us, it's very important to consider the price insiders pay for shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

While City Office REIT insiders bought shares during the last year, they didn't sell. The average buy price was around US$8.39. This is nice to see since it implies that insiders might see value around current prices. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

insider-trading-volume
insider-trading-volume

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.

Insider Ownership

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 indicates that City Office REIT insiders own about US$7.8m worth of shares (which is 2.5% of the company). Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!

So What Does This Data Suggest About City Office REIT Insiders?

The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. But we don't feel the same about the fact the company is making losses. On this analysis the only slight negative we see is the fairly low (overall) insider ownership; their transactions suggest that they are quite positive on City Office REIT stock. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. To help with this, we've discovered 5 warning signs (2 are significant!) that you ought to be aware of before buying any shares in City Office REIT.

Of course City Office REIT 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 currently account for open market transactions and private dispositions, but not derivative transactions.

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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.