Yahoo Finance A number of insiders bought E2 Metals Limited (ASX:E2M) stock last year, which is great news for shareholders
Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of E2 Metals Limited (ASX:E2M), it sends a favourable message to the company's shareholders.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
Check out our latest analysis for E2 Metals
The Last 12 Months Of Insider Transactions At E2 Metals
The insider Martin Donohue made the biggest insider purchase in the last 12 months. That single transaction was for AU$245k worth of shares at a price of AU$0.30 each. That means that even when the share price was higher than AU$0.12 (the recent price), an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels. We note that Martin Donohue was both the biggest buyer and the biggest seller.
In the last twelve months insiders purchased 1.47m shares for AU$411k. But insiders sold 318.49k shares worth AU$81k. In the last twelve months there was more buying than selling by E2 Metals insiders. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Insider Ownership of E2 Metals
For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that E2 Metals insiders own 19% of the company, worth about AU$4.5m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At E2 Metals Tell Us?
It doesn't really mean much that no insider has traded E2 Metals shares in the last quarter. However, our analysis of transactions over the last year is heartening. Insiders do have a stake in E2 Metals and their transactions don't cause us concern. 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. For instance, we've identified 6 warning signs for E2 Metals (3 are significant) you should be aware of.
But note: E2 Metals may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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, but not derivative transactions.
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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.
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