Independent Non-Executive Chairman Patrick Donald Davies Just Bought 21% More Shares In Neuren Pharmaceuticals Limited (ASX:NEU)

Even if it's not a huge purchase, we think it was good to see that Patrick Donald Davies, the Independent Non-Executive Chairman of Neuren Pharmaceuticals Limited (ASX:NEU) recently shelled out AU$50k to buy stock, at AU$1.43 per share. While we're hesitant to get too excited about a purchase of that size, we do note it increased their holding by a solid 21%.

View our latest analysis for Neuren Pharmaceuticals

The Last 12 Months Of Insider Transactions At Neuren Pharmaceuticals

In the last twelve months, the biggest single sale by an insider was when the Independent Non-Executive Director, Trevor Scott, sold AU$520k worth of shares at a price of AU$1.30 per share. That means that even when the share price was below the current price of AU$1.38, an insider wanted to cash in some shares. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. It is worth noting that this sale was only 10% of Trevor Scott's holding. The only individual insider seller over the last year was Trevor Scott.

Happily, we note that in the last year insiders paid AU$169k for 121.06k shares. On the other hand they divested 400.00k shares, for AU$520k. You can see a visual depiction of insider transactions (by companies and 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!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).

Insider Ownership of Neuren 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. Insiders own 6.5% of Neuren Pharmaceuticals shares, worth about AU$10m, according to our data. But they may have an indirect interest through a corporate structure that we haven't picked up on. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!

So What Does This Data Suggest About Neuren Pharmaceuticals Insiders?

It's certainly positive to see the recent insider purchase. On the other hand the transaction history, over the last year, isn't so positive. We don't take much heart from transactions by Neuren Pharmaceuticals insiders over the last year. But they own a reasonable amount of the company, and there was some buying recently. Overall they seem reasonably aligned. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Neuren Pharmaceuticals. For instance, we've identified 2 warning signs for Neuren Pharmaceuticals (1 is a bit concerning) 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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