Insiders who purchased US$511k worth of Tandem Diabetes Care, Inc. (NASDAQ:TNDM) shares over the past year recouped some of their losses after price gained 3.9% last week. The purchase, however, has proven to be a pricey bet, with losses currently totalling US$201k.
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.
Our analysis indicates that TNDM is potentially undervalued!
Tandem Diabetes Care Insider Transactions Over The Last Year
In the last twelve months, the biggest single sale by an insider was when the Executive VP & COO, David Berger, sold US$201k worth of shares at a price of US$65.00 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The silver lining is that this sell-down took place above the latest price (US$44.27). So it may not shed much light on insider confidence at current levels.
In the last twelve months insiders purchased 7.00k shares for US$511k. But insiders sold 3.50k shares worth US$244k. In the last twelve months there was more buying than selling by Tandem Diabetes Care insiders. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Does Tandem Diabetes Care Boast High Insider Ownership?
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. Tandem Diabetes Care insiders own about US$15m worth of shares. That equates to 0.5% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
What Might The Insider Transactions At Tandem Diabetes Care Tell Us?
It doesn't really mean much that no insider has traded Tandem Diabetes Care shares in the last quarter. However, our analysis of transactions over the last year is heartening. Insiders own shares in Tandem Diabetes Care and we see no evidence to suggest they are worried about the future. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. While conducting our analysis, we found that Tandem Diabetes Care has 1 warning sign and it would be unwise to ignore it.
But note: Tandem Diabetes Care 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, but not derivative transactions.
What are the risks and opportunities for Tandem Diabetes Care?
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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.
Tandem Diabetes Care
Tandem Diabetes Care, Inc., a medical device company, designs, develops, and commercializes various products for people with insulin-dependent diabetes in the United States and internationally.
Flawless balance sheet with reasonable growth potential.