We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So before you buy or sell Vigil Health Solutions Inc. (CVE:VGL), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
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, such insiders must disclose their trading activities, and not trade on inside information.
Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. 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'.
Vigil Health Solutions Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Independent Chairman of the Board Gregory Peet for CA$144k worth of shares, at about CA$0.29 per share. That implies that an insider found the current price of CA$0.30 per share to be enticing. Of course they may have changed their mind. But this suggests they are optimistic. 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. Happily, the Vigil Health Solutions insiders decided to buy shares at close to current prices.
In the last twelve months insiders purchased 701.50k shares for CA$206k. On the other hand they divested 4500 shares, for CA$1.6k. In total, Vigil Health Solutions insiders bought more than they sold over the last year. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Vigil Health Solutions is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Have Vigil Health Solutions Insiders Traded Recently?
We saw some Vigil Health Solutions insider buying shares in the last three months. Independent Director Lindsay Ryerson bought CA$7.7k worth of shares in that time. It's good to see the insider buying, as well as the lack of recent sellers. However, in this case the amount invested recently is quite small.
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Vigil Health Solutions insiders own about CA$3.4m worth of shares (which is 63% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Does This Data Suggest About Vigil Health Solutions Insiders?
Insider purchases may have been minimal, in the last three months, but there was no selling at all. The net investment is not enough to encourage us much. However, our analysis of transactions over the last year is heartening. Judging from their transactions, and high insider ownership, Vigil Health Solutions insiders feel good about the company's future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Vigil Health Solutions. Be aware that Vigil Health Solutions is showing 3 warning signs in our investment analysis, and 2 of those make us uncomfortable...
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.
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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. Thank you for reading.