Those following along with ESSA Pharma Inc. (CVE:EPI) will no doubt be intrigued by the recent purchase of shares by Franklin Berger, Independent Director of the company, who spent a stonking CA$804k on stock at an average price of CA$8.04. Not only is that a big swing, but it increased their holding size by 18%, which is definitely great to see.
ESSA Pharma Insider Transactions Over The Last Year
Notably, that recent purchase by Independent Director Franklin Berger was not the only time they bought ESSA Pharma shares this year. They previously made an even bigger purchase of CA$1.6m worth of shares at a price of CA$7.16 per share. That implies that an insider found the current price of CA$8.72 per share to be enticing. 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. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. In this case we're pleased to report that the insider purchases were made at close to current prices.
While ESSA Pharma insiders bought shares during the last year, they didn't sell. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insider Ownership of ESSA Pharma
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Our data indicates that ESSA Pharma insiders own about CA$9.1m worth of shares (which is 3.6% of the company). Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!
So What Does This Data Suggest About ESSA Pharma Insiders?
It's certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that ESSA Pharma insiders are expecting a bright future. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Be aware that ESSA Pharma is showing 4 warning signs in our investment analysis, and 2 of those are concerning...
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.
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. 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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