Erasca Insiders Placed Bullish Bets Worth US$3.97m

In the last year, multiple insiders have substantially increased their holdings of Erasca, Inc. (NASDAQ:ERAS) stock, indicating that insiders' optimism about the company's prospects has increased.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

See our latest analysis for Erasca

Erasca Insider Transactions Over The Last Year

The Co-Founder Jonathan Lim made the biggest insider purchase in the last 12 months. That single transaction was for US$2.0m worth of shares at a price of US$2.03 each. Even though the purchase was made at a significantly lower price than the recent price (US$2.38), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

In the last twelve months Erasca insiders were buying shares, but not selling. 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!

Erasca 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.

Erasca Insiders Bought Stock Recently

It's good to see that Erasca insiders have made notable investments in the company's shares. We can see that Independent Director Alexander Casdin paid US$182k for shares in the company. No-one sold. That shows some optimism about the company's future.

Insider Ownership Of Erasca

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. It appears that Erasca insiders own 12% of the company, worth about US$81m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At Erasca Tell Us?

It's certainly positive to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. But we don't feel the same about the fact the company is making losses. Insiders likely see value in Erasca shares, given these transactions (along with notable insider ownership of the company). 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. Our analysis shows 4 warning signs for Erasca (3 are potentially serious!) and we strongly recommend you look at them before investing.

But note: Erasca 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.