We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. 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 we’ll take a look at whether insiders have been buying or selling shares in Clovis Oncology, Inc. (NASDAQ:CLVS).
Do Insider Transactions Matter?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.
See our latest analysis for Clovis Oncology
The Last 12 Months Of Insider Transactions At Clovis Oncology
In the last twelve months, the biggest single purchase by an insider was when Co-Founder Patrick Mahaffy bought US$280k worth of shares at a price of US$5.61 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$7.45. Because it occurred at a lower valuation, it doesn’t tell us much about whether insiders might find today’s price attractive.
In the last twelve months Clovis Oncology insiders were buying shares, but not selling. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Clovis Oncology is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Does Clovis Oncology Boast High Insider Ownership?
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. It appears that Clovis Oncology insiders own 3.5% of the company, worth about US$23m. We’ve certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At Clovis Oncology Tell Us?
The fact that there have been no Clovis Oncology insider transactions recently certainly doesn’t bother us. But insiders have shown more of an appetite for the stock, over the last year. Overall we don’t see anything to make us think Clovis Oncology insiders are doubting the company, and they do own shares. While we like knowing what’s going on with the insider’s ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For instance, we’ve identified 3 warning signs for Clovis Oncology (1 is significant) you should be aware of.
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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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. 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. Thank you for reading.