In the last year, multiple insiders have substantially increased their holdings of Cargojet Inc. (TSE:CJT) stock, indicating that insiders' optimism about the company's prospects has increased.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
The Last 12 Months Of Insider Transactions At Cargojet
The Founder & Executive Chairman Ajay Virmani made the biggest insider purchase in the last 12 months. That single transaction was for CA$1.0m worth of shares at a price of CA$68.44 each. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of CA$90.04. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.
Over the last year, we can see that insiders have bought 41.25k shares worth CA$3.0m. But they sold 547.00 shares for CA$46k. In total, Cargojet insiders bought more than they sold over the last year. You can see a visual depiction of insider transactions (by companies and 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!
View our latest analysis for Cargojet
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.
Cargojet Insiders Bought Stock Recently
At Cargojet,over the last quarter, we have observed quite a lot more insider buying than insider selling. Director Deepak Chopra spent CA$423k on stock. On the other hand, insider Remi Tremblay netted CA$15k by selling. Insiders have spent more buying shares than they have selling, so on balance we think they are are probably optimistic.
Does Cargojet 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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 2.6% of Cargojet shares, worth about CA$32m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
What Might The Insider Transactions At Cargojet Tell Us?
It's certainly positive to see the recent insider purchase. And the longer term insider transactions also give us confidence. Given that insiders also own a fair bit of Cargojet we think they are probably pretty confident of a bright future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 2 warning signs for Cargojet you should be aware of, and 1 of these is a bit unpleasant.
But note: Cargojet may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
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 of direct interests only, but not derivative transactions or indirect interests.
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