Jonathan Lim Spends US$275k On Erasca Stock \
Investors who take an interest in Erasca, Inc. (NASDAQ:ERAS) should definitely note that the Co-Founder, Jonathan Lim, recently paid US$2.75 per share to buy US$275k worth of the stock. Although the purchase is not a big one, by either a percentage standpoint or absolute value, it can be seen as a good sign.
Check out our latest analysis for Erasca
Erasca Insider Transactions Over The Last Year
In fact, the recent purchase by Co-Founder Jonathan Lim was not their only acquisition of Erasca shares this year. Earlier in the year, they paid US$2.84 per share in a US$284k purchase. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$2.71). It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
Erasca insiders may have bought shares in the last year, but they didn't sell any. Their average price was about US$3.44. This is nice to see since it implies that insiders might see value around current prices. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Erasca 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 Erasca
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 21% of Erasca shares, worth about US$86m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Does This Data Suggest About Erasca Insiders?
The recent insider purchases are heartening. We also take confidence from the longer term picture of insider transactions. 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 Erasca we think they are probably pretty confident of a bright future. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For example, Erasca has 4 warning signs (and 1 which is a bit concerning) we think you should know about.
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 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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