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- NasdaqCM:SANW
Why Did S&W Seed Company's' (NASDAQ:SANW) Insiders Buy Up More Shares?
S&W Seed Company, an agricultural company, engages in breeding, growing, processing, and selling alfalfa seeds. S&W Seed is one of United States’s small-cap stocks that saw some insider buying over the past three months, with insiders investing in 285.10k shares during this period. It is widely considered that insider buying stock in their own companies is potentially a bullish signal. The MIT Press (1998) published an article showing that stocks following insider buying outperformed the market by 4.5%. But these signals may not be sufficient to gain confidence on whether to invest. I will be analysing whether these buying activities are supported by favourable future outlook and recent share price volatility. See our latest analysis for S&W Seed
Who Are Ramping Up Their Shares?

Is Future Growth Outlook As Bullish?

Did Stock Price Volatility Instigate Buying?
Alternatively, the timing of these insider transactions may have been driven by share price volatility. A correlation could mean directors are trading on market inefficiencies based on their belief of the company’s intrinsic value. Within the past three months, S&W Seed’s share price traded at a high of $3.8 and a low of $3.15. This suggests reasonable volatility with a change of 20.63%. This may not be large enough to warrant any significant purchases, therefore the underlying driver may be the insiders' belief of company growth prospects or simply their personal portfolio rebalancing.Next Steps:
S&W Seed’s net buying tells us the stock is in favour with some insiders, reinforced by the substantial earnings growth expectations, though share price volatility was perhaps inconsequential to cash in on any mispricing. Although insider buying can be a useful prompt, following the lead of an insider, however, will never replace diligent research. I've compiled two important factors you should further examine:
- Financial Health: Does S&W Seed have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
- Other High Quality Alternatives : Are there other high quality stocks you could be holding instead of S&W Seed? Explore our interactive list of high quality stocks to get an idea of what else is out there you may be missing!
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Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article 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.
About NasdaqCM:SANW
S&W Seed
An agricultural company, engages in breeding, growing, processing, and sale of alfalfa and sorghum seeds in North and South America, Australia, and internationally.
Low and slightly overvalued.
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