Whilst it may not be a huge deal, we thought it was good to see that the Neuren Pharmaceuticals Limited (ASX:NEU) Independent Non-Executive Chairman, Patrick Donald Davies, recently bought AU$51k worth of stock, for AU$1.77 per share. While we're hesitant to get too excited about a purchase of that size, we do note it increased their holding by a solid 24%.
The Last 12 Months Of Insider Transactions At Neuren Pharmaceuticals
In fact, the recent purchase by Independent Non-Executive Chairman Patrick Donald Davies was not their only acquisition of Neuren Pharmaceuticals shares this year. They previously made an even bigger purchase of AU$52k worth of shares at a price of AU$1.15 per share. We do like to see buying, but this purchase was made at well below the current price of AU$1.72. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.
In the last twelve months Neuren Pharmaceuticals insiders were buying shares, but not selling. Their average price was about AU$1.39. It's great to see insiders putting their own cash into the company's stock, albeit at below the recent share price (AU$1.72). 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!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insider Ownership of Neuren Pharmaceuticals
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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Our data indicates that Neuren Pharmaceuticals insiders own about AU$13m worth of shares (which is 7.8% of the company). But they may have an indirect interest through a corporate structure that we haven't picked up on. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!
So What Does This Data Suggest About Neuren Pharmaceuticals Insiders?
The recent insider purchases are heartening. And the longer term insider transactions also give us confidence. But we don't feel the same about the fact the company is making losses. Insiders likely see value in Neuren Pharmaceuticals shares, given these transactions (along with notable insider ownership of the company). 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. Case in point: We've spotted 2 warning signs for Neuren Pharmaceuticals you should be aware of, and 1 of these makes us a bit uncomfortable.
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. 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. 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. Thank you for reading.