It is not uncommon to see companies perform well in the years after insiders buy shares. 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 shareholders might well want to know whether insiders have been buying or selling shares in Frontera Energy Corporation (TSE:FEC).
Do Insider Transactions Matter?
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 it is perfectly logical to keep tabs on what insiders are doing. 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'.
Frontera 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.
Happily, we note that in the last year insiders paid CA$93k for 25.00k shares. But they sold 9.40k shares for CA$47k. In total, Frontera Energy insiders bought more than they sold over the last year. The average buy price was around CA$3.71. I'd consider this a positive as it suggests insiders see value at around the current price, which is CA$2.29. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Frontera Energy is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Frontera Energy Insiders Bought Stock Recently
We saw some Frontera Energy insider buying shares in the last three months. Chief Financial Officer Alejandro Pineros Ospina shelled out CA$47k for shares in that time. 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.
Does Frontera Energy Boast High 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. We usually like to see fairly high levels of insider ownership. Our data isn't picking up on much insider ownership at Frontera Energy, though insiders do hold about CA$216k worth of shares. We might be missing something but that seems like very low insider ownership.
So What Do The Frontera Energy Insider Transactions Indicate?
We note a that there has been a bit of insider buying recently (but no selling). Overall the buying isn't worth writing home about. But insiders have shown more of an appetite for the stock, over the last year. We'd like to see bigger individual holdings. However, we don't see anything to make us think Frontera Energy insiders are doubting the company. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example - Frontera Energy has 1 warning sign we think you should be aware of.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.
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