Quite a few insiders have dramatically grown their holdings in Brookfield Corporation (TSE:BN) over the past 12 months. An insider's optimism about the company's prospects is a positive sign.

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.

See our latest analysis for Brookfield

The Last 12 Months Of Insider Transactions At Brookfield

In the last twelve months, the biggest single purchase by an insider was when insider Samuel J. Pollock bought CA$12m worth of shares at a price of CA$61.08 per share. Even though the purchase was made at a significantly lower price than the recent price (CA$79.44), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Happily, we note that in the last year insiders paid CA$44m for 757.25k shares. But they sold 433.53k shares for CA$26m. In the last twelve months there was more buying than selling by Brookfield insiders. You can see a visual depiction of insider transactions (by companies and 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!

Brookfield is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Insiders At Brookfield Have Sold Stock Recently

The last three months saw significant insider selling at Brookfield. Specifically, insiders ditched CA$18m worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.

Insider Ownership Of Brookfield

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Brookfield insiders own 11% of the company, currently worth about CA$14b based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Do The Brookfield Insider Transactions Indicate?

Insiders sold stock recently, but they haven't been buying. On the other hand, the insider transactions over the last year are encouraging. We are also comforted by the high levels of insider ownership. So we're not too bothered by recent selling. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Be aware that Brookfield is showing 4 warning signs in our investment analysis, and 2 of those are a bit concerning...

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.

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.