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 shareholders might well want to know whether insiders have been buying or selling shares in OptiNose, Inc. (NASDAQ:OPTN).
What Is Insider Buying?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. 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 equally, we would consider it foolish to ignore insider transactions altogether. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.'
OptiNose Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by CEO & Director Peter Miller for US$154k worth of shares, at about US$14.32 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$9.46). It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
In the last twelve months insiders purchased 31182 shares for US$352k. But they sold 2000 for US$16k. In the last twelve months there was more buying than selling by OptiNose insiders. Their average price was about US$11.30. These transactions suggest that insiders have considered the current price attractive. You can see the insider transactions (by individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
OptiNose Insiders Are Selling The Stock
Over the last three months, we've seen a bit of insider selling at OptiNose. Executive VP & Chief Commercial Officer Thomas Gibbs divested only US$16k worth of shares in that time. It's not great to see insider selling, nor the lack of recent buyers. But the selling simply isn't sufficiently substantial to be of much use as a signal.
Insider Ownership of OptiNose
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. It appears that OptiNose insiders own 6.2% of the company, worth about US$24m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Does This Data Suggest About OptiNose Insiders?
While there has not been any insider buying in the last three months, there has been selling. However, the sales are not big enough to concern us at all. However, our analysis of transactions over the last year is heartening. Insiders own shares in OptiNose and we see no evidence to suggest they are worried about the future. Of course, the future is what matters most. So if you are interested in OptiNose, you should check out this free report on analyst forecasts for the company.
But note: OptiNose may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
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