We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So we'll take a look at whether insiders have been buying or selling shares in Calyxt, Inc. (NASDAQ:CLXT).
Do Insider Transactions Matter?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.
We don't think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year.'
Calyxt Insider Transactions Over The Last Year
In the last twelve months, the biggest single sale by an insider was when the Director, Yves Ribeill, sold US$333k worth of shares at a price of US$17.39 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The silver lining is that this sell-down took place above the latest price (US$10.25). So it may not shed much light on insider confidence at current levels.
We note that in the last year insiders divested 73370 shares for a total of US$985k. Calyxt insiders didn't buy any shares over the last year. The chart below shows insider transactions (by individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
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Insiders at Calyxt Have Sold Stock Recently
The last three months saw some Calyxt insider selling. Founder & Chief Science Officer Daniel Voytas divested only US$48k worth of shares in that time. It's not great to see insider selling, nor the lack of recent buyers. But the amount sold isn't enough for us to put any weight on it.
Does Calyxt Boast High Insider Ownership?
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. From looking at our data, insiders own US$2.5m worth of Calyxt stock, about 0.7% of the company. We prefer to see high levels of insider ownership.
So What Does This Data Suggest About Calyxt Insiders?
Our data shows a little more insider selling, but no insider buying, in the last three months. But given the selling was modest, we're not worried. Recent insider selling makes us a little nervous, in light of the broader picture of Calyxt insider transactions. We also note that, as far as we can see, insider ownership is fairly low, compared to other companies. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body.
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