Insiders At Cryosite Sold AU$8.3m Of Stock Potentially Indicating Weakness

Cryosite Limited's (ASX:CTE) stock rose 10.0% last week, but insiders who sold AU$8.3m worth of stock over the last year are probably in a more advantageous position. Holding on to stock would have meant their investment would be worth less now than it was at the time of sale. Thus selling at an average price of AU$1.02, which is higher than the current price, may have been the best decision.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Cryosite

Cryosite Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the insider, Andrew Kroger, for AU$7.3m worth of shares, at about AU$1.05 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The good news is that this large sale was at well above current price of AU$0.88. So it may not tell us anything about how insiders feel about the current share price.

Happily, we note that in the last year insiders paid AU$6.4m for 8.00m shares. But they sold 8.15m shares for AU$8.3m. In total, Cryosite insiders sold more than they bought over the last year. The average sell price was around AU$1.02. It is certainly not great to see that insiders have sold shares in the company. However, we do note that the average sale price was significantly higher than the current share price (which is AU$0.88). You can see the insider transactions (by companies and 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!

For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.

Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. It's great to see that Cryosite insiders own 60% of the company, worth about AU$26m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Does This Data Suggest About Cryosite Insiders?

The fact that there have been no Cryosite insider transactions recently certainly doesn't bother us. While we feel good about high insider ownership of Cryosite, we can't say the same about the selling of shares. While it's good to be aware of 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. While conducting our analysis, we found that Cryosite has 1 warning sign and it would be unwise to ignore this.

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 of direct interests only, but not derivative transactions or indirect interests.

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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.