Hopeful week for insiders who might be regretting buying US$750k of Couchbase, Inc. (NASDAQ:BASE) stock earlier this year
Insiders who bought US$750k worth of Couchbase, Inc. (NASDAQ:BASE) stock in the last year recovered part of their losses as the stock rose by 12% last week. However, the purchase is proving to be a costly gamble, since losses made by insiders have totalled US$254k since the time of purchase.
Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Check out our latest analysis for Couchbase
The Last 12 Months Of Insider Transactions At Couchbase
Over the last year, we can see that the biggest insider purchase was by insider Edward Anderson for US$750k worth of shares, at about US$24.00 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$15.88). Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when an insider has purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. The only individual insider to buy over the last year was Edward Anderson.
You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Couchbase is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insider Ownership of Couchbase
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. From what we can see in our data, insiders own only about US$575k worth of Couchbase shares. It's always possible we are missing something but from our data, it looks like insider ownership is minimal.
What Might The Insider Transactions At Couchbase Tell Us?
There haven't been any insider transactions in the last three months -- that doesn't mean much. On a brighter note, the transactions over the last year are encouraging. We'd like to see bigger individual holdings. However, we don't see anything to make us think Couchbase insiders are doubting the company. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Our analysis shows 2 warning signs for Couchbase (1 is significant!) and we strongly recommend you look at them before investing.
But note: Couchbase 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.
