Usually, when one insider buys stock, it might not be a monumental event. But when multiple insiders are buying like they did in the case of Aldeyra Therapeutics, Inc.( NASDAQ:ALDX ), that sends out a positive message to the company's shareholders.
While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.
The Last 12 Months Of Insider Transactions At Aldeyra Therapeutics
Over the last year, we can see that the biggest insider sale was by the insider, Stephen Machatha, for US$114k worth of shares, at about US$5.15 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The good news is that this large sale was at well above current price of US$1.62. So it may not tell us anything about how insiders feel about the current share price. Stephen Machatha was the only individual insider to sell shares in the last twelve months.
In the last twelve months insiders purchased 77.50k shares for US$118k. On the other hand they divested 22.07k shares, for US$114k. Overall, Aldeyra Therapeutics insiders were net buyers during the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Check out our latest analysis for Aldeyra Therapeutics
Aldeyra Therapeutics is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations,this free list of growing companies with recent insider purchasing, could be just the ticket.
Insiders At Aldeyra Therapeutics Have Bought Stock Recently
Over the last quarter, Aldeyra Therapeutics insiders have spent a meaningful amount on shares. Overall, two insiders shelled out US$105k for shares in the company -- and none sold. This is a positive in our book as it implies some confidence.
Insider Ownership
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Our data suggests Aldeyra Therapeutics insiders own 3.3% of the company, worth about US$3.1m. We prefer to see high levels of insider ownership.
So What Do The Aldeyra Therapeutics Insider Transactions Indicate?
The recent insider purchases are heartening. We also take confidence from the longer term picture of insider transactions. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that Aldeyra Therapeutics insiders are expecting a bright future. While it's good to be aware of 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. Our analysis shows 3 warning signs for Aldeyra Therapeutics (2 can't be ignored!) and we strongly recommend you look at these before investing.
Of course Aldeyra Therapeutics may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
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 of direct interests only, but not derivative transactions or indirect interests.
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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.
