Even if it’s not a huge purchase, we think it was good to see that Chitwant Kohli, the Independent Director of Aurora Cannabis Inc. (TSE:ACB) recently shelled out CA$84k to buy stock, at CA$2.10 per share. Even though that isn’t a massive buy, it did increase their holding by 200%, which is arguably a good sign.
Aurora Cannabis Insider Transactions Over The Last Year
In fact, the recent purchase by Chitwant Kohli was the biggest purchase of Aurora Cannabis shares made by an insider individual in the last twelve months, according to our records. So it’s clear an insider wanted to buy, even at a higher price than the current share price (being CA$2.01). Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Chitwant Kohli was the only individual insider to buy shares in the last twelve months.
The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Does Aurora Cannabis Boast High Insider Ownership?
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. From what we can see in our data, insiders own only about CA$301k worth of Aurora Cannabis shares. We might be missing something but that seems like very low insider ownership.
So What Does This Data Suggest About Aurora Cannabis Insiders?
The recent insider purchase is heartening. And the longer term insider transactions also give us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that Aurora Cannabis insiders are expecting 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. To that end, you should learn about the 3 warning signs we’ve spotted with Aurora Cannabis (including 1 which is potentially serious).
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. 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.