Rain Enhancement Technologies Holdco Insiders US$450k Short Of Breakeven On Stock Purchase

Insiders who bought US$950.3k worth of Rain Enhancement Technologies Holdco, Inc. (NASDAQ:RAIN) stock in the last year recovered part of their losses as the stock rose by 16% last week. The purchase, however, has proven to be a pricey bet, with losses currently totalling US$450k.

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.

AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early.

Rain Enhancement Technologies Holdco Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Chairman Harry You bought US$500k worth of shares at a price of US$11.39 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$6.00). 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.

Happily, we note that in the last year insiders paid US$950k for 83.43k shares. On the other hand they divested 7.32k shares, for US$41k. In the last twelve months there was more buying than selling by Rain Enhancement Technologies Holdco insiders. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

View our latest analysis for Rain Enhancement Technologies Holdco

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Rain Enhancement Technologies Holdco Insiders Are Selling The Stock

The last three months saw some Rain Enhancement Technologies Holdco insider selling. Independent Director Lyman Dickerson only netted US$41k selling shares, in that period. Neither the lack of buying nor the presence of selling is heartening. But the selling simply isn't sufficiently substantial to be of much use as a signal.

Does Rain Enhancement Technologies Holdco Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Rain Enhancement Technologies Holdco insiders own 54% of the company, currently worth about US$22m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

What Might The Insider Transactions At Rain Enhancement Technologies Holdco Tell Us?

While there has not been any insider buying in the last three months, there has been selling. But given the selling was modest, we're not worried. But insiders have shown more of an appetite for the stock, over the last year. Judging from their transactions, and high insider ownership, Rain Enhancement Technologies Holdco insiders feel good about the company's future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Rain Enhancement Technologies Holdco. At Simply Wall St, we've found that Rain Enhancement Technologies Holdco has 5 warning signs (4 are a bit concerning!) that deserve your attention before going any further with your analysis.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.