Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of Next Hydrogen Solutions Inc. (CVE:NXH), it sends a favourable message to the company's shareholders.
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.
Next Hydrogen Solutions Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Independent Director Adarsh Mehta for CA$503k worth of shares, at about CA$0.45 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being CA$0.45). 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. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. Notably Adarsh Mehta was also the biggest seller.
Over the last year, we can see that insiders have bought 3.12m shares worth CA$1.4m. On the other hand they divested 592.75k shares, for CA$340k. In total, Next Hydrogen Solutions insiders bought more than they sold over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
Check out our latest analysis for Next Hydrogen Solutions
There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).
Next Hydrogen Solutions Insiders Are Selling The Stock
There was substantially more insider selling, than buying, of Next Hydrogen Solutions shares over the last three months. In that time, insiders dumped CA$83k worth of shares. On the other hand we note Independent Director Adarsh Mehta bought CA$1.3k worth of shares. Generally this level of net selling might be considered a bit bearish.
Insider Ownership Of Next Hydrogen Solutions
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 Next Hydrogen Solutions insiders own about CA$3.0m worth of shares (which is 11% of the company). Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!
What Might The Insider Transactions At Next Hydrogen Solutions Tell Us?
Unfortunately, there has been more insider selling of Next Hydrogen Solutions stock, than buying, in the last three months. But we take heart from prior transactions. But insiders own relatively little of the company, from what we can see. So we can't be sure that insiders are optimistic. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Case in point: We've spotted 6 warning signs for Next Hydrogen Solutions you should be aware of, and 3 of these are significant.
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 of direct interests only, but not derivative transactions or indirect interests.
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