The recent 12% drop in Blackboxstocks Inc.'s (NASDAQ:BLBX) stock could come as a blow to insiders who purchased US$200k worth of stock at an average buy price of US$2.10 over the past 12 months. Insiders buy with the expectation to see their investments rise in value over a period of time. However, recent losses have rendered their above investment worth US$70k which is not ideal.
Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.
Before we look at these insider transactions though, you might like to know that our analysis indicates that BLBX is potentially overvalued!
The Last 12 Months Of Insider Transactions At Blackboxstocks
Over the last year, we can see that the biggest insider purchase was by Non-Employee Independent Director Ray Balestri for US$100k worth of shares, at about US$5.00 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$0.73). It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when an insider has purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. Ray Balestri was the only individual insider to buy during the last year.
Ray Balestri bought 95.37k shares over the last 12 months at an average price of US$2.10. 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!
Blackboxstocks is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Does Blackboxstocks 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. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that Blackboxstocks insiders own 42% of the company, worth about US$3.9m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
What Might The Insider Transactions At Blackboxstocks Tell Us?
It doesn't really mean much that no insider has traded Blackboxstocks shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. It would be great to see more insider buying, but overall it seems like Blackboxstocks insiders are reasonably well aligned (owning significant chunk of the company's shares) and optimistic for the future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Blackboxstocks. Every company has risks, and we've spotted 4 warning signs for Blackboxstocks (of which 1 shouldn't be ignored!) you should know about.
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, but not derivative transactions.
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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.
Blackboxstocks Inc. develops and markets financial technology and social media hybrid platform.
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