Everbridge, Inc. (NASDAQ:EVBG) insiders need another US$575k to breakeven on a US$1.5m stock purchase even after recent gains

By
Simply Wall St
Published
March 18, 2022
NasdaqGM:EVBG
Source: Shutterstock

Insiders who bought US$1.5m worth of Everbridge, Inc. (NASDAQ:EVBG) stock in the last year have seen some of their losses recouped as the stock gained 15% last week. However, the purchase is proving to be an expensive wager as insiders are yet to get ahead of their losses which currently stand at US$575k since the time of purchase.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Everbridge

The Last 12 Months Of Insider Transactions At Everbridge

Over the last year, we can see that the biggest insider purchase was by Lead Independent Director Bruns Grayson for US$671k worth of shares, at about US$67.08 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$41.35). 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 22.70k shares for US$1.5m. But insiders sold 10.09k shares worth US$1.5m. In total, Everbridge insiders bought more than they sold over the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

insider-trading-volume
NasdaqGM:EVBG Insider Trading Volume March 18th 2022

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 0.7% of Everbridge shares, worth about US$12m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At Everbridge Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. But insiders have shown more of an appetite for the stock, over the last year. Overall we don't see anything to make us think Everbridge insiders are doubting the company, and they do own shares. 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. To help with this, we've discovered 4 warning signs (1 is a bit unpleasant!) that you ought to be aware of before buying any shares in Everbridge.

But note: Everbridge 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, but not derivative transactions.

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