Possible turnaround for Establishment Labs Holdings Inc. (NASDAQ:ESTA) insiders, still down US$573k after a US$4.5m shopping spree
Insiders who bought US$4.5m worth of Establishment Labs Holdings Inc. (NASDAQ:ESTA) stock in the last year have seen some of their losses recouped as the stock gained 4.9% last week. However, the purchase is proving to be a costly gamble, since losses made by insiders have totalled US$573k since the time of purchase.
While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.
Check out our latest analysis for Establishment Labs Holdings
The Last 12 Months Of Insider Transactions At Establishment Labs Holdings
The Independent Director Edward Schutter made the biggest insider purchase in the last 12 months. That single transaction was for US$2.3m worth of shares at a price of US$72.00 each. That means that an insider was happy to buy shares at above the current price of US$60.41. Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Edward Schutter was the only individual insider to buy during the last year.
Edward Schutter purchased 65.03k shares over the year. The average price per share was US$69.21. 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!
Establishment Labs Holdings is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insider Ownership
Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that Establishment Labs Holdings insiders own 11% of the company, worth about US$158m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
What Might The Insider Transactions At Establishment Labs Holdings Tell Us?
The fact that there have been no Establishment Labs Holdings insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. Judging from their transactions, and high insider ownership, Establishment Labs Holdings insiders feel good about the company's 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. While conducting our analysis, we found that Establishment Labs Holdings has 2 warning signs and it would be unwise to ignore them.
Of course Establishment Labs Holdings may not be the best stock to buy. So you may wish to see this free collection 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.
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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.
