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Potential e-therapeutics plc (LON:ETX) shareholders may wish to note that the Executive Chairman, Ahmad Mortazavi, recently bought UK£200k worth of stock, paying UK£0.12 for each share. Although the purchase only increased their holding by 3.4%, it is still a solid purchase in our view.
e-therapeutics Insider Transactions Over The Last Year
Notably, that recent purchase by Ahmad Mortazavi is the biggest insider purchase of e-therapeutics shares that we’ve seen in the last year. So it’s clear an insider wanted to buy, at around the current price, which is UK£0.12. 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. If someone buys shares at well below current prices, it’s a good sign on balance, but keep in mind they may no longer see value. The good news for e-therapeutics share holders is that insiders were buying at near the current price.
While e-therapeutics insiders bought shares during the last year, they didn’t sell. 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!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this freelist of companies. (Hint: insiders have been buying them).
Insider Ownership of e-therapeutics
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. e-therapeutics insiders own about UK£19m worth of shares. That equates to 37% of the company. While this is a strong but not outstanding level of insider ownership, it’s enough to indicate some alignment between management and smaller shareholders.
So What Does This Data Suggest About e-therapeutics Insiders?
It is good to see recent purchasing. And the longer term insider transactions also give us confidence. However, we note that the company didn’t make a profit over the last twelve months, which makes us cautious. Given that insiders also own a fair bit of e-therapeutics we think they are probably pretty confident of a bright future. In addition to knowing about insider transactions going on, it’s beneficial to identify the risks facing e-therapeutics. When we did our research, we found 4 warning signs for e-therapeutics (2 shouldn’t be ignored!) that we believe deserve your full attention.
Of course e-therapeutics may not be the best stock to buy. So you may wish to see this freecollection 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, but not derivative transactions.
This article by Simply Wall St is general in nature. 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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