Diamyd Medical AB (publ) (STO:DMYD B) insiders who sold earlier this year missed the bus as stock gained 11% last week

While it’s been a great week for Diamyd Medical AB (publ) (STO:DMYD B) shareholders after stock gained 11%, they should consider it with a grain of salt. The fact that insiders chose to dispose of kr3.9m worth of stock in the past 12 months even though prices were relatively low could be indicative of some anticipated weakness.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for Diamyd Medical

The Last 12 Months Of Insider Transactions At Diamyd Medical

In the last twelve months, the biggest single sale by an insider was when the Director, Anders Essen-Möller, sold kr3.7m worth of shares at a price of kr12.20 per share. That means that even when the share price was below the current price of kr17.90, an insider wanted to cash in some shares. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 4.4% of Anders Essen-Möller's holding. Anders Essen-Möller was the only individual insider to sell shares in the last twelve months.

Over the last year, we can see that insiders have bought 17.50k shares worth kr223k. But insiders sold 310.00k shares worth kr3.9m. Anders Essen-Möller sold a total of 310.00k shares over the year at an average price of kr12.67. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Insider Ownership

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Diamyd Medical insiders own about kr305m worth of shares. That equates to 22% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At Diamyd Medical Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. It's heartening that insiders own plenty of stock, but we'd like to see more insider buying, since the last year of Diamyd Medical insider transactions don't fill us with confidence. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Diamyd Medical. Our analysis shows 3 warning signs for Diamyd Medical (1 is a bit concerning!) and we strongly recommend you look at them before investing.

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. 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.