Insiders who bought US$992.2k worth of IGM Biosciences, Inc. (NASDAQ:IGMS) stock in the last year recovered part of their losses as the stock rose by 33% last week. The purchase, however, has proven to be a pricey bet, with losses currently totalling US$256k.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
Check out our latest analysis for IGM Biosciences
The Last 12 Months Of Insider Transactions At IGM Biosciences
In the last twelve months, the biggest single purchase by an insider was when Independent Director M. Behrens bought US$900k worth of shares at a price of US$8.00 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$6.01). It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
In the last twelve months insiders purchased 122.50k shares for US$992k. But insiders sold 52.92k shares worth US$971k. Overall, IGM Biosciences insiders were net buyers during the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
IGM Biosciences is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Does IGM Biosciences Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Our data indicates that IGM Biosciences insiders own about US$6.0m worth of shares (which is 1.7% of the company). But they may have an indirect interest through a corporate structure that we haven't picked up on. We do generally prefer see higher levels of insider ownership.
So What Do The IGM Biosciences Insider Transactions Indicate?
It doesn't really mean much that no insider has traded IGM Biosciences shares in the last quarter. However, our analysis of transactions over the last year is heartening. The transactions are fine but it'd be more encouraging if IGM Biosciences insiders bought more shares in the company. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Every company has risks, and we've spotted 4 warning signs for IGM Biosciences you should know about.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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 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.