Pleasing Signs As A Number Of Insiders Buy eHealth Stock

Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of eHealth, Inc. (NASDAQ:EHTH), it sends a favourable message to the company's shareholders.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

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The Last 12 Months Of Insider Transactions At eHealth

Over the last year, we can see that the biggest insider purchase was by CEO & Director Francis Soistman for US$204k worth of shares, at about US$4.07 per share. That means that even when the share price was higher than US$3.74 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. 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.

In the last twelve months insiders purchased 96.87k shares for US$399k. But they sold 20.00k shares for US$105k. Overall, eHealth insiders were net buyers during the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

View our latest analysis for eHealth

eHealth is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

eHealth Insiders Bought Stock Recently

Over the last three months, we've seen a bit of insider buying at eHealth. Senior VP Gavin Galimi bought US$41k worth of shares in that time. It's great to see that insiders are only buying, not selling. But in this case the amount purchased means the recent transaction may not be very meaningful on its own.

Does eHealth 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. Our data indicates that eHealth insiders own about US$7.3m worth of shares (which is 6.2% of the company). Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!

So What Does This Data Suggest About eHealth Insiders?

Our data shows a little insider buying, but no selling, in the last three months. That said, the purchases were not large. But insiders have shown more of an appetite for the stock, over the last year. The transactions are fine but it'd be more encouraging if eHealth insiders bought more shares in the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing eHealth. Every company has risks, and we've spotted 2 warning signs for eHealth you should know about.

Of course eHealth 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 of direct interests only, but not derivative transactions or indirect interests.

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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.