In the last year, multiple insiders have substantially increased their holdings of Saputo Inc. (TSE:SAP) 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, we would consider it foolish to ignore insider transactions altogether.
Saputo Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by insider Emanuele Saputo for CA$15m worth of shares, at about CA$36.50 per share. That means that even when the share price was higher than CA$31.47 (the recent price), an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
Saputo insiders may have bought shares in the last year, but they didn’t sell any. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
Saputo is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Saputo Insiders Bought Stock Recently
Over the last three months, we’ve seen significant insider buying at Saputo. insider Haig Poutchigian spent CA$90k on stock, and there wasn’t any selling. This could be interpreted as suggesting a positive outlook.
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Saputo insiders own about CA$97m worth of shares. That equates to 0.7% of the company. We’ve certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At Saputo Tell Us?
It is good to see the recent insider purchase. And the longer term insider transactions also give us confidence. When combined with notable insider ownership, these factors suggest Saputo insiders are well aligned, and that they may think the share price is too low. So these insider transactions can help us build a thesis about the stock, but it’s also worthwhile knowing the risks facing this company. Every company has risks, and we’ve spotted 3 warning signs for Saputo (of which 2 are a bit concerning!) you should know about.
But note: Saputo 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, but not derivative transactions.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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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