The recent price decline of 13% in Empery Digital Inc.'s (NASDAQ:EMPD) stock may have disappointed insiders who bought US$6.76m worth of shares at an average price of US$5.59 in the past 12 months. Insiders purchase with the hope of seeing their investments increase in value over time. However, due to recent losses, their initial investment is now only worth US$5.55m, which is not great.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
Empery Digital Insider Transactions Over The Last Year
The insider Tice Brown made the biggest insider purchase in the last 12 months. That single transaction was for US$4.3m worth of shares at a price of US$4.67 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$4.59). 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. To us, it's very important to consider the price insiders pay for 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. We note that Tice Brown was both the biggest buyer and the biggest seller.
Over the last year, we can see that insiders have bought 1.21m shares worth US$6.8m. But they sold 14.98k shares for US$62k. Overall, Empery Digital insiders were net buyers during the last year. Their average price was about US$5.59. This is nice to see since it implies that insiders might see value around current prices. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
Check out our latest analysis for Empery Digital
There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).
Empery Digital Insiders Are Selling The Stock
The last quarter saw substantial insider selling of Empery Digital shares. Specifically, insider Tice Brown ditched US$62k worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.
Does Empery Digital 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. We usually like to see fairly high levels of insider ownership. It appears that Empery Digital insiders own 9.6% of the company, worth about US$14m. 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 Empery Digital Tell Us?
An insider sold Empery Digital shares recently, but they didn't buy any. But we take heart from prior transactions. It's good to see insiders are shareholders. So we're happy enough to look past some selling. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Empery Digital. Case in point: We've spotted 6 warning signs for Empery Digital you should be aware of, and 3 of these can't be ignored.
But note: Empery Digital may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
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.