Len Mertz Bought 12% More Shares In Alpha Cognition

Investors who take an interest in Alpha Cognition Inc. (NASDAQ:ACOG) should definitely note that the Independent Chairman, Len Mertz, recently paid US$9.00 per share to buy US$250k worth of the stock. That's a very solid buy in our book, and increased their holding by a noteworthy 12%.

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Alpha Cognition Insider Transactions Over The Last Year

In fact, the recent purchase by Len Mertz was the biggest purchase of Alpha Cognition shares made by an insider individual in the last twelve months, according to our records. That means that even when the share price was higher than US$8.10 (the recent price), an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. 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 74.08k shares for US$557k. But they sold 27.78k shares for US$250k. Overall, Alpha Cognition insiders were net buyers during the last year. The average buy price was around US$7.52. It's great to see insiders putting their own cash into the company's stock, albeit at below the recent share price. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

Check out our latest analysis for Alpha Cognition

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.

Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Alpha Cognition insiders own 14% of the company, worth about US$18m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Does This Data Suggest About Alpha Cognition Insiders?

It's certainly positive to see the recent insider purchases. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. When combined with notable insider ownership, these factors suggest Alpha Cognition insiders are well aligned, and that they may think the share price is too low. While it's good to be aware of 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. At Simply Wall St, we've found that Alpha Cognition has 4 warning signs (1 is significant!) that deserve your attention before going any further with your analysis.

But note: Alpha Cognition may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

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.