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Several Insiders Invested In ESS Tech Flagging Positive News

It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in ESS Tech, Inc.'s (NYSE:GWH) case, it's fantastic news for shareholders.

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.

See our latest analysis for ESS Tech

The Last 12 Months Of Insider Transactions At ESS Tech

Over the last year, we can see that the biggest insider purchase was by Chairman Harry Quarls for US$102k worth of shares, at about US$1.27 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$1.14). 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. 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.

Over the last year, we can see that insiders have bought 271.60k shares worth US$355k. But they sold 28.98k shares for US$59k. Overall, ESS Tech insiders were net buyers during the last year. 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!

insider-trading-volume
insider-trading-volume

ESS Tech is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insiders At ESS Tech Have Bought Stock Recently

It's good to see that ESS Tech insiders have made notable investments in the company's shares. Overall, two insiders shelled out US$252k for shares in the company -- and none sold. This is a positive in our book as it implies some confidence.

Does ESS Tech Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. ESS Tech insiders own about US$14m worth of shares. That equates to 7.1% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At ESS Tech Tell Us?

It is good to see recent purchasing. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. Insiders likely see value in ESS Tech shares, given these transactions (along with notable insider ownership of 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. Every company has risks, and we've spotted 4 warning signs for ESS Tech you should know about.

Of course ESS Tech 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 of direct interests only, but not derivative transactions or indirect interests.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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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