With shares up 3.4%, insiders at Erie Indemnity Company (NASDAQ:ERIE) must be wishing they had bought more in the past year


Erie Indemnity Company (NASDAQ:ERIE) insiders who bought stocks in the past year were handsomely rewarded last week. The stock rose 3.4%, leading to a $387 million increase in the company’s market capitalization. As a result, their original purchase of US$74,000 worth of stock is now worth US$89,000.

While we don’t believe shareholders should simply follow insider trading, we would consider it foolish to ignore insider trading altogether.

However, if you prefer to see where opportunities and risks are within the REA industryyou can consult our analysis on the American insurance sector.

The last 12 months of insider trading at Erie Indemnity

Over the past year, we can see that the largest insider buy was made by Independent Chairman of the Board, Thomas Hagen, for US$74,000 worth of stock, at around US$185 per share. . Even though the purchase was made at a significantly lower price than the recent price (US$223), we still believe that insider buying is a positive. While this suggests insiders consider the stock undervalued at lower prices, this trade tells us little about what they think of current prices.

You can see insider trading (by companies and individuals) over the past year illustrated in the table below. If you want to know exactly who sold, how much and when, just click on the chart below!

NasdaqGS: ERIE Insider Trading Volume September 12, 2022

There are always plenty of stocks that insiders are buying. So if it suits your style you can check each stock one by one or you can take a look at this free list of companies. (Hint: insiders bought them).

Does Erie Indemnity boast high insider ownership?

Many investors like to check how much a company is owned by insiders. Usually, the higher the insider ownership, the more likely insiders will be incentivized to build the company for the long term. It’s great to see that Erie Indemnity insiders own 41% of the company, worth approximately $4.2 billion. This type of significant insider ownership generally increases the chances that the company will be run in the best interests of all shareholders.

So what do Erie Indemnity’s insider trading indicate?

There have been no insider trades in the last three months – that’s not saying much. On a more positive note, last year’s transactions are encouraging. It would be great to see more insider buying, but overall it looks like Erie Indemnity insiders are reasonably well-aligned (holding a significant portion of the company’s stock) and optimistic about the future. In addition to knowing what insider trading is going on, it pays to identify the risks that Erie Indemnity faces. Example: we have identified 1 warning sign for Erie Indemnity you should be aware.

But note: 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 persons who report their transactions to the relevant regulatory body. We currently record open market transactions and private dispositions, but not derivative transactions.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

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