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We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell RiceBran Technologies (NASDAQ:RIBT), you may well want to know whether insiders have been buying or selling.
What Is Insider Buying?
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Columbia University study found that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.
RiceBran Technologies Insider Transactions Over The Last Year
Chairman Brent Rosenthal made the biggest insider purchase in the last 12 months. That single transaction was for US$74k worth of shares at a price of US$2.68 each. So it's clear an insider wanted to buy, at around the current price, which is US$3.22. Of course they may have changed their mind. But this suggests they are optimistic. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. Happily, the RiceBran Technologies insiders decided to buy shares at close to current prices.
In the last twelve months insiders paid US$318k for 113k shares purchased. In the last twelve months RiceBran Technologies insiders were buying shares, but not selling. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
RiceBran Technologies is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
RiceBran Technologies Insiders Bought Stock Recently
It's good to see that RiceBran Technologies insiders have made notable investments in the company's shares. Overall, six insiders shelled out US$111k for shares in the company -- and none sold. That shows some optimism about the company's future.
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Our data indicates that RiceBran Technologies insiders own about US$7.8m worth of shares (which is 7.1% of the company). But they may have an indirect interest through a corporate structure that we haven't picked up on. We do generally prefer see higher levels of insider ownership.
So What Does This Data Suggest About RiceBran Technologies Insiders?
The recent insider purchases are heartening. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. While the overall levels of insider ownership are below what we'd like to see, the history of transactions imply that RiceBran Technologies insiders are reasonably well aligned, and optimistic for the future. Of course, the future is what matters most. So if you are interested in RiceBran Technologies, you should check out this free report on analyst forecasts for the company.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.