Insiders who purchased US$70.6k worth of NextTrip, Inc. (NASDAQ:NTRP) shares over the past year recouped some of their losses after price gained 14% last week. However, the purchase is proving to be an expensive wager as insiders are yet to get ahead of their losses which currently stand at US$15k since the time of purchase.

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.

NextTrip Insider Transactions Over The Last Year

The Independent Director Andy Kaplan made the biggest insider purchase in the last 12 months. That single transaction was for US$50k worth of shares at a price of US$2.75 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$2.42). 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. In our view, the price an insider pays for shares is very important. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. Andy Kaplan was the only individual insider to buy shares in the last twelve months.

Andy Kaplan bought a total of 23.18k shares over the year at an average price of US$3.05. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

NextTrip is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that NextTrip insiders own 43% of the company, worth about US$13m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At NextTrip Tell Us?

The recent insider purchase is heartening. We also take confidence from the longer term picture of insider transactions. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Once you factor in the high insider ownership, it certainly seems like insiders are positive about NextTrip. That's what I like to see! 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. At Simply Wall St, we've found that NextTrip has 7 warning signs (3 shouldn't be ignored!) that deserve your attention before going any further with your analysis.

Of course NextTrip may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

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.

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.