When company insiders — management, officers or any beneficial owners with more than 10% of a company’s shares, as defined by the SEC — buy shares of their own company it’s a bullish sign. That’s because they believe the stock price will rise in the future.
Luckily, insiders must file SEC forms every time they buy or sell shares, which is how we can track who is buying and who is selling.
Since insider purchases are considered a bullish sign, Finbold analyzed insider purchases in 2023 and selected the two companies where most insiders bought shares this year.
Picks for you
B. Riley Financial
B. Riley Financial (NASDAQ: RILY) is a financial services platform that provides tailored financial solutions in areas such as investment banking, real estate, retail, venture capital, wealth management, auction and liquidation, bankruptcy, restructuring and more.
In 2023, Riley Financial had 19 insiders purchase a total of 433,841 shares at an average price of $40,65. That’s $17.6 million worth of shares, making it the largest insider purchase this year.
Recent RILY insider purchases. Source: Finviz
Morningstar’s quantitative equity report has a fair value estimate of $79.86 per share for RILY, while the company trades at $53.96 at the moment. That’s a 47% difference if Morningstar’s fair value is reached in the future.
Morningstar quantitative equity report. Source: Interactive Brokers Fundamentals Explorer
Better Therapeutics
Better Therapeutics (NASDAQ: BTTX) is a prescription digital therapeutics company engaged in developing cognitive behavioral therapy to address the root causes of cardiometabolic diseases.
This is the second most-purchased stock by insiders in 2023. So far, 10 insiders bought 8,236,319 shares at an average price of $1.25. That’s $8 million worth of shares scooped up by company insiders.
Recent BTTX insider purchases. Source: Finviz
BTTX shares currently trade at $0.71, while Morningstar’s quantitative equity report has given a fair value estimate of $1.22, around what the insiders paid on average.
Morningstar quantitative equity report. Source: Interactive Brokers Fundamentals Explorer
BTTX has had a rough year, returning -35% year to date, while RILY outperformed the S&P 500’s 17% return with a 57% gain during the same period.
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Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
