Positive Signs As Multiple Insiders Buy Cambium Networks Stock
When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in Cambium Networks Corporation's (NASDAQ:CMBM) instance, it's good news for shareholders.
Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.
Check out our latest analysis for Cambium Networks
The Last 12 Months Of Insider Transactions At Cambium Networks
The CEO, President & Director Morgan C. Kurk made the biggest insider purchase in the last 12 months. That single transaction was for US$99k worth of shares at a price of US$8.82 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$2.22). 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. 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.
Cambium Networks insiders may have bought shares in the last year, but they didn't sell any. Their average price was about US$5.62. This is nice to see since it implies that insiders might see value around current prices. 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!
Cambium Networks is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.
Insider Ownership
Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Our data suggests Cambium Networks insiders own 4.2% of the company, worth about US$2.8m. We consider this fairly low insider ownership.
So What Do The Cambium Networks Insider Transactions Indicate?
The fact that there have been no Cambium Networks insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. While we have no worries about the insider transactions, we'd be more comfortable if they owned more Cambium Networks stock. 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. Case in point: We've spotted 3 warning signs for Cambium Networks you should be aware of, and 1 of them makes us a bit uncomfortable.
But note: Cambium Networks 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.
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