For most publicly-traded companies, founders or senior executives are often looked to for guidance, from both employees as well as investors.
Both parties have a vested interest in the financial health and well-being of a given company, and as such, tend to look to senior leadership for the kinds of actions that may be relied upon to inspire confidence, action, or a willingness to believe and invest one’s hard earned money in the mission of said company. This is an action which most do not take lightly.
In the case of Canadian cannabis producer Aurora Cannabis Inc. (TSX:ACB)(NYSE:ACB), there was a recent stock sale in which a co-founder of the company sold a large chunk of stock. This was during a time when the company’s share price was plummeting down to earth.
Therefore, this decision inspired a sense of worry and suspicion that all may not be dandy on the marijuana farm. This action, in the context of serious cost-cutting measures, has been cause for concern, and for good reason.
As always, please remember to consult with a certified financial advisor and do your own research before making investing decisions. Insider buying or selling activity is not necessarily indicative of the future performance of a given company’s stock price.
Insiders regularly buy or sell positions in companies they manage for reasons other than expectations of future performance. Analyzing insider transactions in a given stock is one tool of many to glean pertinent information to assist in investment decision-making.
Invest wisely my friends.