U.S. markets open in 3 hours 59 minutes
  • S&P Futures

    4,074.25
    -15.75 (-0.39%)
     
  • Dow Futures

    34,017.00
    -139.00 (-0.41%)
     
  • Nasdaq Futures

    12,114.00
    -38.00 (-0.31%)
     
  • Russell 2000 Futures

    1,932.90
    -6.50 (-0.34%)
     
  • Crude Oil

    78.89
    +0.02 (+0.03%)
     
  • Gold

    1,940.00
    -5.30 (-0.27%)
     
  • Silver

    23.50
    -0.34 (-1.41%)
     
  • EUR/USD

    1.0890
    +0.0024 (+0.22%)
     
  • 10-Yr Bond

    3.5290
    0.0000 (0.00%)
     
  • Vix

    19.69
    -0.25 (-1.25%)
     
  • GBP/USD

    1.2318
    +0.0001 (+0.00%)
     
  • USD/JPY

    129.8500
    -0.2180 (-0.17%)
     
  • BTC-USD

    23,008.59
    +97.90 (+0.43%)
     
  • CMC Crypto 200

    524.33
    +5.54 (+1.07%)
     
  • FTSE 100

    7,777.50
    +5.80 (+0.07%)
     
  • Nikkei 225

    27,346.88
    +19.77 (+0.07%)
     

Reata Pharmaceuticals, Inc.'s stock is down 14%, but insiders still have about US$163k in profit after buying earlier this year

Insiders who purchased Reata Pharmaceuticals, Inc. (NASDAQ:RETA) shares in the past 12 months are unlikely to be deeply impacted by the stock's 14% decline over the past week. After taking the recent loss into consideration, the US$420k worth of stock they bought is now worth US$582k, indicating that their investment yielded a positive return.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for Reata Pharmaceuticals

The Last 12 Months Of Insider Transactions At Reata Pharmaceuticals

In the last twelve months, the biggest single purchase by an insider was when COO, CFO & President Manmeet Soni bought US$420k worth of shares at a price of US$26.22 per share. We do like to see buying, but this purchase was made at well below the current price of US$36.38. 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.

You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
insider-trading-volume

Reata Pharmaceuticals 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.

Insider Ownership Of Reata Pharmaceuticals

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Reata Pharmaceuticals insiders own 12% of the company, currently worth about US$162m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At Reata Pharmaceuticals Tell Us?

It doesn't really mean much that no insider has traded Reata Pharmaceuticals shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. It would be great to see more insider buying, but overall it seems like Reata Pharmaceuticals insiders are reasonably well aligned (owning significant chunk of the company's shares) and optimistic for the future. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. At Simply Wall St, we found 3 warning signs for Reata Pharmaceuticals that deserve your attention before buying any shares.

But note: Reata Pharmaceuticals 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.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.

Join A Paid User Research Session
You’ll receive a US$30 Amazon Gift card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here