CVD Equipment Up 13%, Insiders Still Down After US$2.35m Purchase

Some of the losses seen by insiders who purchased US$2.35m worth of CVD Equipment Corporation (NASDAQ:CVV) shares over the past year were recovered after the stock increased by 13% over the past week. However, the purchase is proving to be a costly gamble, since losses made by insiders have totalled US$876k since the time of purchase.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for CVD Equipment

CVD Equipment Insider Transactions Over The Last Year

The Independent Director Andrew Africk made the biggest insider purchase in the last 12 months. That single transaction was for US$1.1m worth of shares at a price of US$5.07 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$3.20). Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Andrew Africk was the only individual insider to buy shares in the last twelve months.

Andrew Africk bought 461.60k shares over the last 12 months at an average price of US$5.10. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

CVD Equipment is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Insiders At CVD Equipment Have Sold Stock Recently

We have seen a bit of insider selling at CVD Equipment, over the last three months. insider Raymond Nielsen sold just US$26k worth of shares in that time. Neither the lack of buying nor the presence of selling is heartening. But the selling simply isn't sufficiently substantial to be of much use as a signal.

Does CVD Equipment Boast High Insider Ownership?

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 23% of CVD Equipment shares, worth about US$4.4m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Do The CVD Equipment Insider Transactions Indicate?

We did not see any insider buying in the last three months, but we did see selling. But the sales were small, so we're not concerned. On a brighter note, the transactions over the last year are encouraging. Insiders own shares in CVD Equipment and we see no evidence to suggest they are worried about the future. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. For example - CVD Equipment has 1 warning sign we think you should be aware of.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.