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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 AcelRx Pharmaceuticals, Inc. (NASDAQ:ACRX).
What Is Insider Selling?
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 don't think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. 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 AcelRx Pharmaceuticals
Independent Director Mark Edwards made the biggest insider purchase in the last 12 months. That single transaction was for US$57k worth of shares at a price of US$2.99 each. That means that an insider was happy to buy shares at above the current price of US$2.24. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. 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.
AcelRx Pharmaceuticals insiders may have bought shares in the last year, but they didn't sell any. The average buy price was around US$2.35. I'd consider this a positive as it suggests insiders see value at around the current price. The chart below shows insider transactions (by individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
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.
AcelRx Pharmaceuticals Insiders Bought Stock Recently
Over the last quarter, AcelRx Pharmaceuticals insiders have spent a meaningful amount on shares. Not only was there no selling that we can see, but they collectively bought US$60k worth of shares. This makes one think the business has some good points.
Does AcelRx Pharmaceuticals Boast High Insider Ownership?
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Based on our data, AcelRx Pharmaceuticals insiders have about 1.4% of the stock, worth approximately US$2.5m. We prefer to see high levels of insider ownership.
What Might The Insider Transactions At AcelRx Pharmaceuticals Tell Us?
It's certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. But on the other hand, the company made a loss last year, which makes us a little cautious. On this analysis the only slight negative we see is the fairly low (overall) insider ownership; their transactions suggest that they are quite positive on AcelRx Pharmaceuticals stock. Of course, the future is what matters most. So if you are interested in AcelRx Pharmaceuticals, you should check out this free report on analyst forecasts for the company.
Of course AcelRx Pharmaceuticals may not be the best stock to buy. So you may wish to see this free collection of high quality 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.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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.
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