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Insiders are buying these 2 stocks in bulk. Can they expect growth?

Jessie Ramsdale
1. 4. 2023
5 min read

There are many ways you can identify stocks that can expect to grow. One of them is insider transactions. So let's take a look today at 2 stocks that have seen increased insider activity recently.

Tracking insider trading activity, such as executives and board members, can provide valuable insights into a company's future development. Insider trading can signal confidence in a stock's upside potential, especially when it comes to large stock purchases.

However, it is important to remember that tracking insider trading should not be the only source of information when making investment decisions. A thorough analysis of a company's fundamentals, competitors and overall market conditions should be conducted before making an investment decision.

Market volatility has prompted investors to focus more on data analysis and tracking insider trading activity, i.e., company executives and key shareholders. Tracking the trading activity of these insiders can provide useful information about stocks that have upside potential. In this article, we focus on two stocks where recent insider purchases for significant sums have been recorded.

Guardant Health $GH+13.4%

A chart of the share price over the last 5 years.

Guardant Health is a California-based biotechnology company that focuses on developing advanced diagnostic tests for cancer patients. Their lead product is Guardant360, a pioneering liquid biopsy-based test that analyzes patient blood samples to identify mutations in tumor DNA.

Liquid biopsies are a revolutionary way to diagnose cancer because, unlike traditional biopsies, which require an invasive procedure to collect a sample of tumor tissue, liquid biopsies take blood. This approach simplifies and speeds up the diagnostic process, reduces the risk of complications and can be performed repeatedly, allowing the tumour progression and treatment efficacy to be monitored.

Guardant Health offers a wide range of products and services for physicians, laboratories and research organizations:

  • Guardant360: It is a comprehensive genomic tumor profile that identifies genetic mutations responsible for tumor initiation and growth. This test allows physicians to tailor treatment to each patient based on their genetic profile.
  • GuardantOMNI: This test is designed for pharmaceutical companies and research organizations that are developing new cancer therapies. It helps identify biomarkers for selecting patients for clinical trials and evaluating the effectiveness of new drugs.
  • Guardant Reveal: A test designed for early detection of colorectal cancer recurrence and evaluation of residual disease after treatment. It helps physicians monitor patients and adjust treatment based on test results.
  • LUNAR-1: This is a preclinical test for early detection of cancer in asymptomatic individuals at high risk of developing cancer. The test is still in development and has the potential to become a key tool in the prevention and early diagnosis of cancer.

In the last reported quarter, Guardant had revenues of $126.9 million. The company's co-CEOs Helmy Eltoukhy and AmirAli Talasaz made recent stock purchases of more than $2 million.

Analyst Expectations.

Canaccord Genuity analyst Kyle Mikson rates this stock a Buy with a $60 price target, suggesting 128% upside potential for the next 12 months.

Enovix $ENVX+12.5%

A chart of the stock price over the past 2 years.

Enovix is a U.S. company focused on developing and manufacturing next-generation advanced batteries, with the goal of bringing high-performance, safe batteries to market for a wide range of applications such as electric vehicles, consumer electronics and energy storage.

Enovix is developing batteries with silicon anodes that have the potential to double the storage capacity of current graphite anodes. Silicon anodes also offer improved energy density and longer battery life.

With its patented 3D architecture, Enovix achieves higher energy density and improved safety performance by placing silicon anodes in a space-efficient structure. This 3D architecture also reduces battery swelling, improving overall battery safety and reliability.

Enovix recently announced plans to build an additional production line, dubbed "Gen2 Autoline," to increase the company's production capacity. In addition, Enovix plans to locate its first high-volume production facility, which should allow the company to respond more quickly to the growing demand for its batteries.

Enovix is also entering into strategic partnerships with other market players such as electronics manufacturers and automotive companies to work together to integrate Enovix batteries into their products.

With the growing emphasis on the electrification of transportation, the development of renewable energy and the rapidly changing consumer electronics market, Enovix is well positioned for future success. Their innovative next-generation battery technology with silicon anodes and 3D architecture offers solutions to some of the biggest challenges in today's battery market

Thurman Rodgers of Enovix's board of directors has made a series of large share purchases of more than $2 million

Growing demand for electric vehicles, consumer electronics and renewable energy is driving interest in new, high-performance and safe batteries. Enovix has the potential to become a key player in this fast-growing sector, which is why its stock is considered an attractive investment. Given the significant insider purchases of the stock, we can expect other investors to be interested in Enovix shares as well.

Analyst Expectations.

Conclusion

The insider stock purchases in Guardant Health and Enovix suggest that these companies have the potential to grow. Guardant Health, with its innovations in cancer testing, and Enovix, with its advanced batteries, seem well positioned for future success in their respective markets.

Still, it's important to do further analysis and evaluation of these companies before deciding to invest. Insider trading can be a useful indicator, but should not be the only factor in investment decisions.

WARNING: I am not a financial advisor, and this material does not serve as a financial or investment recommendation. The content of this material is purely informational.


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