Eiger BioPharmaceuticals Insiders US$2.1m Short Of Breakeven On Stock Purchase
Insiders who purchased US$3.42m worth of Eiger BioPharmaceuticals, Inc. (NASDAQ:EIGR) shares over the past year recouped some of their losses after price gained 11% last week. However, the purchase is proving to be a costly gamble, since losses made by insiders have totalled US$2.1m since the time of purchase.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.
View our latest analysis for Eiger BioPharmaceuticals
The Last 12 Months Of Insider Transactions At Eiger BioPharmaceuticals
Over the last year, we can see that the biggest insider purchase was by insider Moshe Arkin for US$2.7m worth of shares, at about US$1.12 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$0.34). It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
In the last twelve months insiders purchased 3.74m shares for US$3.4m. On the other hand they divested 31.90k shares, for US$37k. In total, Eiger BioPharmaceuticals insiders bought more than they sold over the last year. Their average price was about US$0.92. I'd consider this a positive as it suggests insiders see value at around the current price. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
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Eiger BioPharmaceuticals Insiders Bought Stock Recently
Over the last three months, we've seen significant insider buying at Eiger BioPharmaceuticals. Specifically, insider Richard Kayne bought US$530k worth of shares in that time, and we didn't record any sales whatsoever. That shows some optimism about the company's future.
Insider Ownership
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. Our data indicates that Eiger BioPharmaceuticals insiders own about US$2.1m worth of shares (which is 14% of the company). Whilst better than nothing, we're not overly impressed by these holdings.
So What Does This Data Suggest About Eiger BioPharmaceuticals Insiders?
It's certainly positive to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. 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 Eiger BioPharmaceuticals insiders are expecting a bright future. 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. To help with this, we've discovered 5 warning signs (3 are a bit concerning!) that you ought to be aware of before buying any shares in Eiger BioPharmaceuticals.
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.
