On a modest recovery effort by Wall Street on Thursday, workflow software specialist Asana (NYSE:ASAN) popped higher on Thursday. Catalyzing the swing northward was company co-founder and CEO Dustin Moskovitz. Per a securities filing, Moskovitz purchased shares worth $2.7 million on Oct. 17, adding to a buying spree. Subsequently, ASAN stock offers confidence for outside observers.
According to a Seeking Alpha report, the technology entrepreneur acquired 52,175 shares in Asana at $19.71 a pop on Tuesday. Further, the chief executive added another 87,825 shares for $19.03 each, for a transaction value of $1.67 million.
What’s more, on Oct. 16, Moskovitz acquired 140,000 shares on Monday for $18.05 per share. This transaction yielded a value of $2.53 million.
Broadly speaking, the topic of insider acquisitions can be complex to decipher. For example, insider selling doesn’t necessarily imply bearishness. Many reasons exist for an insider to sell a security, including mundane ones such as tax considerations.
However, the concept of insider buying is straightforward: the insider almost always believes that the valuation will rise. Therefore, Moskovitz’s acquisition provides confidence for outside observers of ASAN stock.
Insider Buying Is a Hallmark of ASAN Stock
Nevertheless, even if an insider buy points to a single, logical conclusion, it’s also difficult to read too much into the move without greater context. It’s always useful to remember that affluent investors own the luxury of making mistakes with their money that may cripple the average retail investor. However, internal belief has long been a hallmark of ASAN stock.
According to data from Fintel, insider purchases of ASAN stock — including Moskovitz’s aforementioned acquisitions — amount to 358 transactions. In contrast, the number of insider sells amount to 185 transactions. That’s encouraging because while ASAN gained about 46% so far this year, in the trailing one-year period, it’s only up 3%.
Further, the insider buys suggest a greater alignment between Asana executives’ interests with that of ASAN shareholders. That’s an important factor, particularly as the broader economy faces significant challenges.
Still, it’s curious that one of the biggest options transactions among major traders was the purchase of 840 contracts of the Jan 17 ’25 30.00 Put. Investors may want to monitor any fluctuations in open interest to better gauge forward-looking sentiment for ASAN stock.
Why It Matters
Despite the seemingly positive news for ASAN stock, analysts don’t appear convinced, pegging it a consensus hold. This assessment breaks down as three buys, eight holds and one sell. Overall, the average price target lands at $22.33, implying over 15% upside potential.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
