Insider Stock Buying Reaches CA$1.41m On Next Hydrogen Solutions

Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of Next Hydrogen Solutions Inc. (CVE:NXH), it sends a favourable message to the company's shareholders.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

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The Last 12 Months Of Insider Transactions At Next Hydrogen Solutions

Over the last year, we can see that the biggest insider purchase was by Independent Director Adarsh Mehta for CA$503k worth of shares, at about CA$0.45 per share. That means that even when the share price was higher than CA$0.44 (the recent price), an insider wanted to purchase shares. 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. To us, it's very important to consider the price insiders pay for 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. Notably Adarsh Mehta was also the biggest seller.

In the last twelve months insiders purchased 3.14m shares for CA$1.4m. On the other hand they divested 485.50k shares, for CA$289k. In the last twelve months there was more buying than selling by Next Hydrogen Solutions insiders. 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!

Check out our latest analysis for Next Hydrogen Solutions

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Next Hydrogen Solutions Insiders Are Selling The Stock

We have seen a bit of insider selling at Next Hydrogen Solutions, over the last three months. insider Jim Hinatsu divested only CA$26k worth of shares in that time. Neither the lack of buying nor the presence of selling is heartening. But the amount sold isn't enough for us to put any weight on it.

Insider Ownership

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. Our data indicates that Next Hydrogen Solutions insiders own about CA$3.7m worth of shares (which is 12% of the company). We do generally prefer see higher levels of insider ownership.

What Might The Insider Transactions At Next Hydrogen Solutions Tell Us?

While there has not been any insider buying in the last three months, there has been selling. However, the sales are not big enough to concern us at all. However, our analysis of transactions over the last year is heartening. The transactions are fine but it'd be more encouraging if Next Hydrogen Solutions insiders bought more shares in the company. 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. Our analysis shows 3 warning signs for Next Hydrogen Solutions (1 shouldn't be ignored!) and we strongly recommend you look at these before investing.

But note: Next Hydrogen Solutions 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 of direct interests only, but not derivative transactions or indirect interests.

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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.