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Insiders who bought MGE Energy, Inc. (NASDAQ:MGEE) stock lover the last 12 months are probably not as affected by last week’s 3.6% loss. Even after accounting for the recent loss, the US$116k worth of stock purchased by them is now worth US$125k or in other words, their investment continues to give good returns.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
The Last 12 Months Of Insider Transactions At MGE Energy
Over the last year, we can see that the biggest insider purchase was by Independent Director James Berbee for US$68k worth of shares, at about US$66.26 per share. We do like to see buying, but this purchase was made at well below the current price of US$75.84. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.
James Berbee bought 1.65k shares over the last 12 months at an average price of US$70.53. 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!
MGE Energy is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
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. From our data, it seems that MGE Energy insiders own 0.2% of the company, worth about US$5.0m. We do generally prefer see higher levels of insider ownership.
So What Does This Data Suggest About MGE Energy Insiders?
Our data shows a little insider buying, but no selling, in the last three months. Overall the buying isn't worth writing home about. But insiders have shown more of an appetite for the stock, over the last year. We'd like to see bigger individual holdings. However, we don't see anything to make us think MGE Energy insiders are doubting the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing MGE Energy. At Simply Wall St, we found 1 warning sign for MGE Energy that deserve your attention before buying any shares.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.
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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