Stock Analysis

This Insider Has Just Sold Shares In Establishment Labs Holdings Inc. (NASDAQ:ESTA)

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Anyone interested in Establishment Labs Holdings Inc. (NASDAQ:ESTA) should probably be aware that a company insider, Leslie Gillin, recently divested US$254k worth of shares in the company, at an average price of US$67.62 each. Equally important, that sale actually reduced their holding by a full 51% which hardly makes us feel bullish about the stock.

See our latest analysis for Establishment Labs Holdings

Establishment Labs Holdings Insider Transactions Over The Last Year

Notably, that recent sale by Leslie Gillin is the biggest insider sale of Establishment Labs Holdings shares that we've seen in the last year. That means that even when the share price was below the current price of US$69.55, an insider wanted to cash in some shares. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. It is worth noting that this sale was 51% of Leslie Gillin's holding.

You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

NasdaqCM:ESTA Insider Trading Volume March 19th 2023

I will like Establishment Labs Holdings better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Does Establishment Labs Holdings Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Establishment Labs Holdings insiders own 10% of the company, currently worth about US$177m 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.

So What Does This Data Suggest About Establishment Labs Holdings Insiders?

An insider hasn't bought Establishment Labs Holdings stock in the last three months, but there was some selling. Looking to the last twelve months, our data doesn't show any insider buying. It is good to see high insider ownership, but the insider selling leaves us cautious. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Case in point: We've spotted 4 warning signs for Establishment Labs Holdings you should be aware of, and 1 of them makes us a bit uncomfortable.

Of course Establishment Labs Holdings may not be the best stock to buy. So you may wish to see this free collection of high quality 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, but not derivative transactions.

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