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Potential Calfrac Well Services Ltd. (TSE:CFW) shareholders may wish to note that the Independent Director, Charles Pellerin, recently bought CA$151k worth of stock, paying CA$3.65 for each share. Although the purchase only increased their holding by 1.8%, it is still a solid purchase in our view.
See our latest analysis for Calfrac Well Services
Calfrac Well Services Insider Transactions Over The Last Year
Notably, that recent purchase by Independent Director Charles Pellerin was not the only time they bought Calfrac Well Services shares this year. Earlier in the year, they paid CA$4.15 per share in a CA$2.9m purchase. That means that an insider was happy to buy shares at above the current price of CA$3.85. 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. 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.
While Calfrac Well Services insiders bought shares during the last year, they didn't sell. 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!
Calfrac Well Services is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.
Insider Ownership Of Calfrac Well Services
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. Calfrac Well Services insiders own about CA$45m worth of shares. That equates to 14% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
So What Does This Data Suggest About Calfrac Well Services Insiders?
The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. Given that insiders also own a fair bit of Calfrac Well Services we think they are probably pretty confident of a bright future. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For example, Calfrac Well Services has 3 warning signs (and 1 which shouldn't be ignored) we think you should know about.