We recently published a list of 10 Cheapest Stocks Insiders Are Buying Recently. In this article, we are going to take a look at where GrafTech International Ltd. (NYSE:EAF) stands against other cheapest stocks that insiders are buying recently.
Why should we be interested in affordable stocks? Some investors like to look for cheaper stocks in order to diversify their portfolios, because these penny stocks often operate in different industries than larger businesses.
Some investors’ strategy is finding nascent companies with strong growth potential, which can bring high returns once the companies have grown. Even though penny stocks often carry higher risks and are more prone to market volatility, they also offer investors more room for growth.
What are some ways to assess cheap stocks that are worth investing in? While there’s no single simple or complicated rule that investors can follow to achieve secure results, some strategies can help. One strategy is to keep track of insider trading activity. Insiders or, in other words, people in high positions within companies, such as CEOs, CFOs, directors and other executives have valuable insights into the company’s strategic moves, plans, and initiatives. A CEO’s investment in a company’s stock can sometimes signal strong confidence in the company’s future.
While both insider selling and buying can be driven by various motives, it is important to consider these moves within the broader context of the company’s fundamentals, industry trends, and overall market conditions. That’s why due diligence before any investment is of the utmost importance. However, insider trading activity in combination with other relevant determinants can offer valuable insights into a company’s capabilities, helping investors make more informed investment decisions.
What are some of the most affordable stocks insiders have been buying over the last 30 days? To find out, we used Insider Monkey’s insider trading stock screener, focusing only on stocks where at least two insiders had purchased shares recently. From there, we ranked the 10 stocks with the lowest average price per share.
Our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds, focusing on insider trading and stock picks from hedge fund investor newsletters and conferences. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
With each stock, we note the average price per share of these purchases and the stock’s market capitalization.
A close up of a carbon-based solution as it gets released from a nozzle into a mould.
GrafTech International Ltd. (NYSE:EAF)
Average price per share: $1.06
Market capitalization: $280.42 million
GrafTech International Ltd. (NYSE:EAF) is a producer of graphite electrodes and petroleum coke, which are essential for the production of electric arc furnace steel and other ferrous and non-ferrous metals. The Brooklyn Heights, Ohio-headquartered company was founded in 1886 and has a comprehensive portfolio of affordable, ultra-high power graphite electrode production facilities. It has vertical integration within the petroleum needle coke industry. GrafTech sells its products primarily through a direct sales force, independent sales representatives, and distributors.
On February 13, two insiders, including the CEO, acquired a total of around $105,595 worth of GrafTech International Ltd. (NYSE:EAF) shares at an average price of $1.06 per share. Year-to-date, the stock declined 36.99% and is now trading at $1.09 per share. On February 12, its shares hit the lowest point this year, trading at $1.02, which may suggest that insiders wanted to use the drop and acquire more shares at a more affordable price.
For the full year 2024, the company disclosed net sales of $538.78 million, compared to net sales of $620.50 million in 2023. Net loss for the year amounted to $131.17 million, which compares to net loss of $255.25 million for the full year 2023. Adjusted EBITDA for 2024 was $2 million, compared to adjusted EBITDA of $20 million in the prior year.
The earnings came lower than expected, which could be the reason behind the recent drop in its share price. However, insider trading activity still indicates confidence in this stock’s growth.
Five analysts have an average “Hold” rating on GrafTech International Ltd. (NYSE:EAF) stock, with a 12-month stock price target of $1.73, according to data from Stock Analysis.
Overall, EAF ranks 5th on our list of the cheapest stocks insiders are buying recently. While we acknowledge the potential of EAF as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than EAF but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap
Disclosure: None. This article is originally published at Insider Monkey.
