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 shareholders might well want to know whether insiders have been buying or selling shares in AxoGen, Inc. (NASDAQ:AXGN).
What Is Insider Buying?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, most countries require that the company discloses such transactions to the market.
We don’t think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. As Peter Lynch said, ‘insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.’
AxoGen Insider Transactions Over The Last Year
Chairman Karen Zaderej made the biggest insider sale in the last 12 months. That single transaction was for US$830k worth of shares at a price of US$33.42 each. That is hardly a positive sign, even though it took place above the latest price (US$17.09). So it may not tell us anything about how insiders feel about the current share price.
In total, AxoGen insiders sold more than they bought over the last year. The average sell price was around US$34.71. We are not joyful about insider selling. However, we do note that the average sale price was significantly higher than the current share price (which is US$17.09). You can see the insider transactions 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 winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
AxoGen Insiders Are Selling The Stock
The last quarter saw substantial insider selling of AxoGen shares. In total, insiders dumped US$1.5m worth of shares in that time, and we didn’t record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.
For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It’s great to see that AxoGen insiders own 3.1% of the company, worth about US$20m. 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 AxoGen Insiders?
Insiders sold AxoGen shares recently, but they didn’t buy any. And our longer term analysis of insider transactions didn’t bring confidence, either. Insiders own shares, but we’re still pretty cautious, given the history of sales. So we’d only buy after careful consideration. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for AxoGen.
But note: AxoGen may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at email@example.com.