Several Insiders Invested In FlexShopper Flagging Positive News
Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of FlexShopper, Inc. (NASDAQ:FPAY), it sends a favourable message to the company's shareholders.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.
Check out our latest analysis for FlexShopper
FlexShopper Insider Transactions Over The Last Year
The Chairman of the Board Howard Dvorkin made the biggest insider purchase in the last 12 months. That single transaction was for US$134k worth of shares at a price of US$1.74 each. That means that even when the share price was higher than US$1.24 (the recent price), an insider wanted to purchase shares. 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 always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
FlexShopper insiders may have bought shares in the last year, but they didn't sell any. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
FlexShopper is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
FlexShopper Insiders Bought Stock Recently
Over the last quarter, FlexShopper insiders have spent a meaningful amount on shares. Specifically, Chairman of the Board Howard Dvorkin bought US$144k worth of shares in that time, and we didn't record any sales whatsoever. That shows some optimism about the company's future.
Does FlexShopper Boast High Insider Ownership?
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that FlexShopper insiders own 35% of the company, worth about US$9.3m. 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 FlexShopper Tell Us?
The recent insider purchase is 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. When combined with notable insider ownership, these factors suggest FlexShopper insiders are well aligned, and that they may think the share price is too low. 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 FlexShopper (of which 1 is a bit concerning!) 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 of direct interests only, but not derivative transactions or indirect interests.
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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.
