When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in CymaBay Therapeutics, Inc.'s (NASDAQ:CBAY) instance, it's good news for shareholders.
While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
CymaBay Therapeutics Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by President Sujal Shah for US$100k worth of shares, at about US$1.95 per share. Even though the purchase was made at a significantly lower price than the recent price (US$3.11), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.
CymaBay Therapeutics insiders may have bought shares in the last year, but they didn't sell any. The average buy price was around US$2.26. We don't deny that it is nice to see insiders buying stock in the company. However, we do note that they were buying at significantly lower prices than today's share price. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
CymaBay Therapeutics is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insiders at CymaBay Therapeutics Have Bought Stock Recently
Over the last quarter, CymaBay Therapeutics insiders have spent a meaningful amount on shares. President Sujal Shah spent US$100k on stock, and there wasn't any selling. This makes one think the business has some good points.
Insider Ownership of CymaBay Therapeutics
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Based on our data, CymaBay Therapeutics insiders have about 0.4% of the stock, worth approximately US$1.1m. I generally like to see higher levels of ownership.
So What Does This Data Suggest About CymaBay Therapeutics Insiders?
It is good to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. But on the other hand, the company made a loss during the last year, which makes us a little cautious. On this analysis the only slight negative we see is the fairly low (overall) insider ownership; their transactions suggest that they are quite positive on CymaBay Therapeutics stock. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For instance, we've identified 4 warning signs for CymaBay Therapeutics (1 is significant) you should be aware of.
But note: CymaBay Therapeutics may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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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