Whenever insiders buy a substantial amount of stock, investors ought to take notice. One certainly likes to see a scenario where a company’s management team believes the stock of the company they manage is undervalued, so much so that putting their own money on the line is the action that is taken. In the case of Tourmaline Oil (TSX:TOU), this is the case. The company’s Chairman, President & CEO recently paid more than $250,000 for additional exposure to his company, a signal of potential outperformance on the horizon.
I think we could be entering a period of time where energy companies outperform. I see a commodity rebound on the horizon for 2021, so this move didn’t surprise me in some ways. I think of insider transactions like these as confirmation of such a thesis. For investors interested in increasing their exposure to the energy space, I would suggest checking out companies like Tourmaline with management teams that are high-conviction on the space.
As always, please remember to consult with a certified financial advisor into your own homework before making investing decisions. Insider buying and selling activity is not necessarily indicative of the future performance of a given company’s stock price, and insiders regularly buy or sell positions in companies they own or manage for reasons other than expectations of future stock price performance. Analyzing insider transactions in a given stock is one tool of many to gain pertinent information to assist in investment decision making.
Invest wisely, my friends.
