We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell Harvard Bioscience, Inc. (NASDAQ:HBIO), you may well want to know whether insiders have been buying or selling.
What Is Insider Buying?
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, such insiders must disclose their trading activities, and not trade on inside information.
We don't think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Columbia University study found that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.
The Last 12 Months Of Insider Transactions At Harvard Bioscience
Lead Independent Director Bertrand Loy made the biggest insider purchase in the last 12 months. That single transaction was for US$105k worth of shares at a price of US$3.11 each. So it's clear an insider wanted to buy, at around the current price, which is US$3.17. Of course they may have changed their mind. But this suggests they are optimistic. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. In this case we're pleased to report that the insider purchases were made at close to current prices.
In the last twelve months Harvard Bioscience insiders were buying shares, but not selling. They paid about US$2.62 on average. Although they bought at below the recent share price, it is good to see that insiders are willing to invest in the company. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
Harvard Bioscience is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insiders at Harvard Bioscience Have Bought Stock Recently
Over the last quarter, Harvard Bioscience insiders have spent a meaningful amount on shares. Not only was there no selling that we can see, but they collectively bought US$119k worth of shares. That shows some optimism about the company's future.
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Harvard Bioscience insiders own about US$14m worth of shares. That equates to 12% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
So What Do The Harvard Bioscience Insider Transactions Indicate?
It is good to see recent purchasing. 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. Given that insiders also own a fair bit of Harvard Bioscience we think they are probably pretty confident of a bright future. 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. We currently account for open market transactions and private dispositions, but not derivative transactions.
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