It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in Norbord Inc. (TSE:OSB).
What Is Insider Buying?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, most countries require that the company discloses such transactions to the market.
Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year.
Check out our latest analysis for Norbord
Norbord Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Lead Director Paul Houston bought CA$198k worth of shares at a price of CA$30.31 per share. So it's clear an insider wanted to buy, at around the current price, which is CA$34.59. Of course they may have changed their mind. But this suggests they are optimistic. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. In this case we're pleased to report that the insider bought shares at close to current prices. The only individual insider to buy over the last year was Paul Houston. Notably Paul Houston was also the biggest seller.
Paul Houston bought a total of 13315 shares over the year at an average price of CA$28.81. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Norbord is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insiders at Norbord Have Bought Stock Recently
Over the last three months, we've seen significantly more insider buying, than insider selling, at Norbord. In total, Lead Director Paul Houston bought US$384k worth of shares in that time. But Lead Director Paul Houston sold shares worth US$21k. The buying outweighs the selling, which suggests that insiders may believe the company will do well in the future.