Insiders who bought US$360k worth of Venus Concept Inc.'s (NASDAQ:VERO) stock at an average buy price of US$1.12 over the last year may be disappointed by the recent 13% decrease in the stock. Insiders purchase with the hope of seeing their investments increase in value over time. However, due to recent losses, their initial investment is now only worth US$144k, which is not great.
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.
The Last 12 Months Of Insider Transactions At Venus Concept
The Non-Independent Director Keith Sullivan made the biggest insider purchase in the last 12 months. That single transaction was for US$100k worth of shares at a price of US$1.25 each. That means that an insider was happy to buy shares at above the current price of US$0.45. It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
In the last twelve months Venus Concept insiders were buying shares, but not selling. Their average price was about US$1.12. I'd consider this a positive as it suggests insiders see value at around the current price. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Venus Concept is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Venus Concept Insiders Bought Stock Recently
Over the last quarter, Venus Concept insiders have spent a meaningful amount on shares. Overall, three insiders shelled out US$83k for shares in the company -- and none sold. That shows some optimism about the company's future.
Insider Ownership of Venus Concept
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Based on our data, Venus Concept insiders have about 2.0% of the stock, worth approximately US$590k. I generally like to see higher levels of ownership.
So What Do The Venus Concept Insider Transactions Indicate?
The recent insider purchases are heartening. And the longer term insider transactions also give us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. On this analysis the only slight negative we see is the fairly low (overall) insider ownership; their transactions suggest that they are quite positive on Venus Concept stock. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. At Simply Wall St, we've found that Venus Concept has 4 warning signs (1 is significant!) that deserve your attention before going any further with your analysis.
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, 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.