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We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So before you buy or sell Aqua Metals, Inc. (NASDAQ:AQMS), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, such insiders must disclose their trading activities, and not trade on inside information.
We don't think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year.'
The Last 12 Months Of Insider Transactions At Aqua Metals
CEO, President & Director Stephen Cotton made the biggest insider purchase in the last 12 months. That single transaction was for US$86k worth of shares at a price of US$2.85 each. That means that an insider was happy to buy shares at around the current price. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. We generally consider it a positive if insiders have been buying on market, even if the share price has increased a bit since then.
In the last twelve months insiders paid US$353k for 134.97k shares purchased. In the last twelve months there was more buying than selling by Aqua Metals insiders. Their average price was about US$2.61. Although they bought at below the recent price of US$3.11 per share, it is good to see that insiders are willing to invest in the company. You can see the insider transactions (by 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!
Aqua Metals 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.
Insiders at Aqua Metals Have Bought Stock Recently
Over the last quarter, Aqua Metals insiders have spent a meaningful amount on shares. In total, insiders bought US$107k worth of shares in that time, and we didn't record any sales whatsoever. This could be interpreted as suggesting a positive outlook.
Insider Ownership of Aqua Metals
For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Based on our data, Aqua Metals insiders have about 1.8% of the stock, worth approximately US$2.4m. We consider this fairly low insider ownership.
What Might The Insider Transactions At Aqua Metals Tell Us?
It's certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. But on the other hand, the company made a loss last year, which makes us a little cautious. While the overall levels of insider ownership are below what we'd like to see, the history of transactions imply that Aqua Metals insiders are reasonably well aligned, and optimistic for the future. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Aqua Metals.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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.