This Insider Just Sold Shares of Melcor Developments Ltd. (TSE:MRD)

Investors may wish to note that an insider of Melcor Developments Ltd., Bob Brown, recently made C$76,000 selling shares, receiving an average price of C$16.37. It may not be a huge sum, but it was 53% of their personal equity, so we find that a bit disheartening.

Check out our latest analysis for Melcor Developments

Melcor Developments Insider Trading in the Past Year

In the past twelve months, the largest single insider purchase was when CEO and Executive Chairman Timothy Melton purchased C$317,000 worth of stock at C$14.54 per share. While we like to see insider buying, we note that this big buy was significantly below the recent price of C$17.24. Because it occurred at a lower valuation, that tells us little about whether insiders might find today’s price attractive.

Fortunately, we note that last year, insiders paid C$1.4 million for 104.51,000 shares. But they sold 13.15,000 shares for C$190,000. Overall, Melcor Developments insiders were net buyers over the past year. You can see insider trading (by companies and individuals) over the past year illustrated in the table below. By clicking on the graph below, you will be able to see the precise detail of each insider trade!

TSX:MRD Insider Trading Volume March 26, 2022

Melcor Developments isn’t the only stock insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider buying, might be just the ticket.

Does Melcor Developments boast high insider ownership?

I like to look at how many shares insiders own in a company, to help me get a sense of how aligned they are with insiders. Usually, the higher the insider ownership, the more likely insiders will be incentivized to build the business for the long term. Insiders own 12% of the shares of Melcor Developments, worth approximately C$67 million. While this is a high but not exceptional level of insider ownership, it suffices to indicate some alignment between management and small shareholders.

So what do Melcor Developments insider trading indicate?

We note that there has been slightly more insider selling than buying recently. But the difference is not enough to worry us. On a more positive note, last year’s transactions are encouraging. Insiders hold stock in Melcor Developments and we see no evidence to suggest they are worried about the future. While we like to know what’s going on with insider ownership and trading, we also make sure to consider the risks a stock faces before making any investment decisions. Our analysis shows 5 warning signs for Melcor Developments (2 are concerning!) and we strongly recommend that you consult them before investing.

Sure Melcor Developments may not be the best stock to buy. So you might want to see this free set of high quality companies.

For the purposes of this article, insiders are persons who report their transactions to the relevant regulatory body. We currently record open market transactions and private dispositions, but not derivative transactions.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.