Enbridge Insiders Sell CA$22m Of Stock, Possibly Signalling Caution

Over the past year, many Enbridge Inc. (TSE:ENB) insiders sold a significant stake in the company which may have piqued investors' interest. When evaluating insider transactions, knowing whether insiders are buying is usually more beneficial than knowing whether they are selling, as the latter can be open to many interpretations. However, if numerous insiders are selling, shareholders should investigate more.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

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The Last 12 Months Of Insider Transactions At Enbridge

Over the last year, we can see that the biggest insider sale was by the President, Gregory Ebel, for CA$22m worth of shares, at about CA$66.72 per share. So we know that an insider sold shares at around the present share price of CA$66.06. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. In this case, the big sale took place at around the current price, so it's not too bad (but it's still not a positive).

Happily, we note that in the last year insiders paid CA$1.3m for 21.77k shares. On the other hand they divested 333.51k shares, for CA$22m. Over the last year we saw more insider selling of Enbridge shares, than buying. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

View our latest analysis for Enbridge

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Insiders At Enbridge Have Sold Stock Recently

The last quarter saw substantial insider selling of Enbridge shares. Specifically, President Gregory Ebel ditched CA$22m worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Insider Ownership Of Enbridge

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Enbridge insiders own about CA$107m worth of shares. That equates to 0.07% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Enbridge Insider Transactions Indicate?

An insider hasn't bought Enbridge stock in the last three months, but there was some selling. And our longer term analysis of insider transactions didn't bring confidence, either. It is good to see high insider ownership, but the insider selling leaves us cautious. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 4 warning signs for Enbridge you should be aware of, and 2 of them are a bit unpleasant.

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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.