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 shareholders might well want to know whether insiders have been buying or selling shares in Nexus Real Estate Investment Trust (CVE:NXR.UN).
What Is Insider Selling?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. 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 it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year'.
The Last 12 Months Of Insider Transactions At Nexus Real Estate Investment Trust
The insider Lorne Jacobson made the biggest insider purchase in the last 12 months. That single transaction was for CA$76k worth of shares at a price of CA$1.52 each. So it's clear an insider wanted to buy, at around the current price, which is CA$1.69. 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. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. The good news for Nexus Real Estate Investment Trust share holders is that insiders were buying at near the current price.
Nexus Real Estate Investment Trust insiders may have bought shares in the last year, but they didn't sell any. 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!
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.
Does Nexus Real Estate Investment Trust Boast High Insider Ownership?
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. Our data suggests Nexus Real Estate Investment Trust insiders own 1.2% of the company, worth about CA$2.9m. I generally like to see higher levels of ownership.
So What Do The Nexus Real Estate Investment Trust Insider Transactions Indicate?
The fact that there have been no Nexus Real Estate Investment Trust insider transactions recently certainly doesn't bother us. However, our analysis of transactions over the last year is heartening. We'd like to see bigger individual holdings. However, we don't see anything to make us think Nexus Real Estate Investment Trust insiders are doubting the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Nexus Real Estate Investment Trust. Our analysis shows 4 warning signs for Nexus Real Estate Investment Trust (1 is a bit concerning!) and we strongly recommend you look at these before investing.
Of course Nexus Real Estate Investment Trust 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.
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