Insiders At Pulmonx Sold US$655k Of Stock Potentially Indicating Weakness

Despite the fact that Pulmonx Corporation (NASDAQ:LUNG) stock rose 23% last week, insiders who sold US$655k worth of stock in the previous 12 months are likely to be better off. Selling at an average price of US$4.56, which is higher than the current price, may have been the wisest decision for these insiders as their investment would have been worth less now than when they sold.

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.

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The Last 12 Months Of Insider Transactions At Pulmonx

In the last twelve months, the biggest single sale by an insider was when the CEO, President & Director, Steven Williamson, sold US$198k worth of shares at a price of US$7.14 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The silver lining is that this sell-down took place above the latest price (US$1.98). So it may not shed much light on insider confidence at current levels.

In total, Pulmonx insiders sold more than they bought over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

See our latest analysis for Pulmonx

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

Pulmonx Insiders Are Selling The Stock

The last three months saw significant insider selling at Pulmonx. Specifically, insiders ditched US$54k 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.

Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. From looking at our data, insiders own US$1.7m worth of Pulmonx stock, about 2.7% of the company. We consider this fairly low insider ownership.

So What Do The Pulmonx Insider Transactions Indicate?

Insiders sold Pulmonx shares recently, but they didn't buy any. Despite some insider buying, the longer term picture doesn't make us feel much more positive. Insiders own relatively few shares in the company, and when you consider the sales, we're not particularly excited about the stock. So we're not rushing to buy, to say the least. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Pulmonx. Case in point: We've spotted 4 warning signs for Pulmonx you should be aware of.

But note: Pulmonx 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.

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.