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We often see insiders buying up shares in companies that perform well over the long term. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So shareholders might well want to know whether insiders have been buying or selling shares in Viking Therapeutics, Inc. (NASDAQ:VKTX).
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 would never suggest that investors should base their decisions solely on what the directors of a company have been doing. 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.'
Viking Therapeutics Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Chairman Lawson MacArtney bought US$250k worth of shares at a price of US$5.22 per share. Even though the purchase was made at a significantly lower price than the recent price (US$7.97), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.
Over the last year, we can see that insiders have bought 95465 shares worth US$540k. But they sold 21551 for US$199k. Overall, Viking Therapeutics insiders were net buyers last year. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Viking Therapeutics is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Does Viking Therapeutics Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company 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. Insiders own 2.6% of Viking Therapeutics shares, worth about US$16m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
What Might The Insider Transactions At Viking Therapeutics Tell Us?
It doesn't really mean much that no insider has traded Viking Therapeutics shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. Overall we don't see anything to make us think Viking Therapeutics insiders are doubting the company, and they do own shares. Of course, the future is what matters most. So if you are interested in Viking Therapeutics, you should check out this free report on analyst forecasts for the company.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.