EnteroMedics (ETRM) Climbs On Insider Buying

EnteroMedics Inc (NASDAQ: ETRM)

EnteroMedics is having an incredible day in the market today after an insider announced a big buy of the company’s stock. Today, we’ll talk about who bought the stock, how much was purchased, why investors care, and what we can expect to see moving forward.

EnteroMedics CEO Made A Big Purchase On August 13th.

EnteroMedics CEO, Mark B. Knudson is the subject of quite a bit of discussion today after he made the decision to invest more into his company. On Thursday, August 13th, Knudson purchased 303,000 shares of ETRM at an average price of $0.25 per share. That gives the purchase a total value of $75,750. These are the only shares currently owned by the company’s CEO. The disclosure of the insider purchase was made through a document filed with the Securities & Exchange Commission. If you’d like to read the filing, click here.

Why ETRM Investors Care

If you follow investing news, you’ll see quite a bit about insider buys and insider sales. The reality is that the insiders know much more than us mere mortals. After all, they are what makes the company run. With that said, insider buys and sells help investors get an idea of what to expect from the stock…

  • Insider Buys – When an insider buys a the stock, it shows a specific level of confidence. After all, the CEO of ETRM would be buying 303,000 shares of the company if he believed that the value of the stock is likely to fall. Instead, his goal is to bank off of what he sees as a strong probability for growth by purchasing the shares.
  • Insider Sales – Adversely, when an insider sells shares of the company they are part of, it creates an eerie feeling for investors. After all, if the insider was confident that the shares were likely to grow in value, there would be no reason to sell.

Keeping the above in mind, it’s easy to see why investors are so excited about Knudson’s decision to purchase 303,000 shares of the company. It shows that Knudson is confident that we are likely to see growth on the stock.

How The Market Reacted To The News

The reality is that a big insider buy is enough to get excitement going around a stock; and that’s exactly what we saw. Currently (1:00), ETRM is trading at $0.27 per share after a gain of 7.40% so far today following the news.

What We’re Likely To See Moving Forward

To be quite honest, I’m not currently a follower of ETRM. However, I will say that I find the buy to be very interesting and I will be keeping the stock on my radar moving forward. After all, insider buys are usually great signs that growth is coming. So, keep your eyes peeled for opportunity!

What Do You Think?

Where do you think ETRM is headed and why? Let us know in the comments below!

Image Credit

Previous articleSynergy Pharmaceuticals (SGYP) Stock Reaches Support: What’s Next?
Next articleiBio Stock Continues Bullish Path
Hey, Im Joshua, the founder of CNA Finance. I enjoy following the trends in the market and finding the catalysts that are making the moves. If you want to get in contact with me, leave a comment below or email me at CNAFinanceHelp@gmail.com Please keep in mind that I am not an investment advisor and nor is CNA Finance. This is a news and information gathering outlet. We may work directly with some of the companies that we write about. If we have a business relationship with an issuer, we will mention that in the articles. We also have various affiliate relationships with advertisers and may be paid if you sign up for a service that you were referred to through our website.


Please enter your comment!
Please enter your name here