Having purchased US$1.3m worth of Enhabit, Inc. (NYSE:EHAB) stock, the recent 11% pullback is not what insiders may have expected

Insiders who bought US$1.3m worth of Enhabit, Inc.'s (NYSE:EHAB) stock at an average buy price of US$13.23 over the last year may be disappointed by the recent 11% decrease in the stock. Insiders purchase with the hope of seeing their investments increase in value over time. However, due to recent losses, their initial investment is now only worth US$1.2m, which is not great.

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.

View our latest analysis for Enhabit

The Last 12 Months Of Insider Transactions At Enhabit

In the last twelve months, the biggest single purchase by an insider was when President Barbara Jacobsmeyer bought US$413k worth of shares at a price of US$13.78 per share. That means that even when the share price was higher than US$12.40 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

In the last twelve months Enhabit insiders were buying shares, but not selling. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Enhabit is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insider Ownership Of Enhabit

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Our data indicates that Enhabit insiders own about US$8.1m worth of shares (which is 1.3% of the company). We do generally prefer see higher levels of insider ownership.

So What Does This Data Suggest About Enhabit Insiders?

There haven't been any insider transactions in the last three months -- that doesn't mean much. However, our analysis of transactions over the last year is heartening. The transactions are fine but it'd be more encouraging if Enhabit insiders bought more shares in the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Enhabit. To assist with this, we've discovered 1 warning sign that you should run your eye over to get a better picture of Enhabit.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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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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.

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