Insider Traders Lose US$61k As Cambium Networks Drops

Insiders who acquired US$101.4k worth of Cambium Networks Corporation's (NASDAQ:CMBM) stock at an average price of US$4.15 in the past 12 months may be dismayed by the recent 10% price decline. This is not good as insiders invest based on expectations that their money will appreciate over time. However, as a result of recent losses, their original investment is now worth only US$40.1k.

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.

View our latest analysis for Cambium Networks

Cambium Networks Insider Transactions Over The Last Year

The Independent Director Kevin Lynch made the biggest insider purchase in the last 12 months. That single transaction was for US$63k worth of shares at a price of US$4.03 each. That means that an insider was happy to buy shares at above the current price of US$1.64. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. 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.

While Cambium Networks insiders bought shares during the last year, they didn't sell. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Cambium Networks is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider 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. From looking at our data, insiders own US$2.0m worth of Cambium Networks stock, about 4.2% of the company. We prefer to see high levels of insider ownership.

So What Do The Cambium Networks Insider Transactions Indicate?

The fact that there have been no Cambium Networks insider transactions recently certainly doesn't bother us. However, our analysis of transactions over the last year is heartening. The transactions are fine but it'd be more encouraging if Cambium Networks insiders bought more shares in the company. 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 found 4 warning signs for Cambium Networks that deserve your attention before buying any shares.

But note: Cambium Networks 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.