Possible Bearish Signals With Swedish Orphan Biovitrum Insiders Disposing Stock

Over the past year, many Swedish Orphan Biovitrum AB (publ) (STO:SOBI) insiders sold a significant stake in the company which may have piqued investors' interest. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

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 Swedish Orphan Biovitrum

Swedish Orphan Biovitrum Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the CEO & President, Guido Oelkers, for kr49m worth of shares, at about kr244 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The silver lining is that this sell-down took place above the latest price (kr204). 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 kr25m for 113.74k shares. But they sold 539.00k shares for kr130m. All up, insiders sold more shares in Swedish Orphan Biovitrum than they bought, over the last year. 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 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).

Swedish Orphan Biovitrum Insiders Are Selling The Stock

Over the last three months, we've seen a bit of insider selling at Swedish Orphan Biovitrum. Insiders sold just kr436k worth of shares in that time. Neither the lack of buying nor the presence of selling is heartening. But the volume sold is so low that it really doesn't bother us.

Does Swedish Orphan Biovitrum Boast High Insider Ownership?

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 0.2% of Swedish Orphan Biovitrum shares, worth about kr143m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Swedish Orphan Biovitrum Insiders?

Insiders haven't bought Swedish Orphan Biovitrum stock in the last three months, but there was some selling. Zooming out, the longer term picture doesn't give us much comfort. But it is good to see that Swedish Orphan Biovitrum is growing earnings. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Swedish Orphan Biovitrum. Every company has risks, and we've spotted 1 warning sign for Swedish Orphan Biovitrum you should know about.

Of course Swedish Orphan Biovitrum may not be the best stock to buy. So you may wish to see this free collection of high quality 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.