While it’s not a huge buy, we think it was good to see Thomas Hagen, the independent chairman of the board of directors of Erie Indemnity Company (NASDAQ: ERIE) recently spent US $ 74,000 to buy shares, at US $ 185 per share. While the purchase is not important, either as a percentage or as an absolute value, it can be seen as a good sign.
Check out our latest review for Erie Indemnity
The Last 12 Months of Insider Trading at Erie Indemnity
In fact, the recent purchase by Thomas Hagen was the largest purchase of Erie Indemnity shares by an insider in the past twelve months, according to our records. This means that even when the stock price was above US $ 178 (the recent price), an insider wanted to buy stocks. Their perspective may have since changed, but it at least shows that they were feeling optimistic at the time. In our opinion, the price that an insider pays for the shares is very important. Generally speaking, this comes to our attention when an insider bought shares at prices higher than current prices, as it suggests that they thought the shares were worth buying, even at a higher price. The only individual insider to buy in the past year was Thomas Hagen.
You can see insider trading (by companies and individuals) over the past year shown in the graph below. If you click on the chart you can see all of the individual trades including the stock price, individual and date!
Erie Indemnity isn’t the only one to buy. So take a look at this free list of growing companies with insider buying.
Insider property of Erie Indemnity
For an ordinary shareholder, it is worth checking out how many shares are owned by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will have an incentive to build the business for the long term. Erie Indemnity insiders own 46% of the company, with a current value of around US $ 3.8 billion based on the recent share price. I like to see this level of insider ownership because it increases the chances that management is thinking in the best interests of shareholders.
So what does this data suggest about Erie Indemnity insiders?
It’s good to see the recent insider buy. We also trust the longer term picture of insider trading. When combined with notable insider ownership, these factors suggest that Erie Indemnity insiders are well aligned and most likely think the stock price is too low. One for the watchlist, at least! If you are like me, you might want to ask yourself if this business will grow or shrink. Fortunately, you can check this out free report showing analysts’ forecasts for its future.
But beware : Erie Indemnity may not be the best stock to buy. So take a look at this free list of interesting companies with high ROE and low debt.
For the purposes of this article, insiders are the persons who report their transactions to the relevant regulatory body. We currently account for open market transactions and private assignments, but not derivative transactions.
This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative documents. Simply Wall St has no position in any of the stocks mentioned.
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