Yahoo Finance The CEO, MD & Director of Ecofibre Limited (ASX:EOF), Eric Wang, Just Bought 4.1% More Shares
Whilst it may not be a huge deal, we thought it was good to see that the Ecofibre Limited (ASX:EOF) CEO, MD & Director, Eric Wang, recently bought AU$133k worth of stock, for AU$0.23 per share. However, it only increased their shares held by 4.1%, and it wasn't a huge purchase by absolute value, either.
See our latest analysis for Ecofibre
The Last 12 Months Of Insider Transactions At Ecofibre
Notably, that recent purchase by CEO, MD & Director Eric Wang was not the only time they bought Ecofibre shares this year. Earlier in the year, they paid AU$0.43 per share in a AU$435k purchase. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$0.32). Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
Ecofibre insiders may have bought shares in the last year, but they didn't sell any. The average buy price was around AU$0.36. I'd consider this a positive as it suggests insiders see value at around the current price. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
Ecofibre 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
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. Ecofibre insiders own 54% of the company, currently worth about AU$57m based on the recent share price. 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 Ecofibre Tell Us?
It is good to see recent purchasing. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. When combined with notable insider ownership, these factors suggest Ecofibre insiders are well aligned, and quite possibly think the share price is too low. Nice! 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 3 warning signs for Ecofibre (of which 2 shouldn't be ignored!) 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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