Abeona Therapeutics Insider Stock Sales Prove Timely As Market Valuation Descends To US$232m

Over the past year, insiders sold US$275k worth of Abeona Therapeutics Inc. (NASDAQ:ABEO) stock at an average price of US$4.61 per share allowing them to get the most out of their money. After the stock price dropped 10% last week, the company's market value declined by US$26m, but insiders were able to mitigate their losses.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Abeona Therapeutics

The Last 12 Months Of Insider Transactions At Abeona Therapeutics

Over the last year, we can see that the biggest insider sale was by the Independent Director, Mark Alvino, for US$117k worth of shares, at about US$4.51 per share. That means that an insider was selling shares at slightly below the current price (US$5.26). As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 41% of Mark Alvino's holding.

Over the last year, we can see that insiders have bought 42.76k shares worth US$154k. On the other hand they divested 59.71k shares, for US$275k. In total, Abeona Therapeutics insiders sold more than they bought over the last year. The average sell price was around US$4.61. We don't gain confidence from insider selling below the recent share price. Since insiders sell for many reasons, we wouldn't put too much weight on it. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

I will like Abeona Therapeutics better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Abeona Therapeutics Insiders Are Selling The Stock

The last three months saw some Abeona Therapeutics insider selling. Independent Director Mark Alvino sold just US$42k worth of shares in that time. Neither the lack of buying nor the presence of selling is heartening. But the selling simply isn't sufficiently substantial to be of much use as a signal.

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. 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 appears that Abeona Therapeutics insiders own 7.5% of the company, worth about US$17m. 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 Abeona Therapeutics Tell Us?

We did not see any insider buying in the last three months, but we did see selling. But the sales were small, so we're not concerned. Recent sales exacerbate our caution arising from analysis of Abeona Therapeutics insider transactions. But we do like the fact that insiders own a fair chunk of the company. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To assist with this, we've discovered 2 warning signs that you should run your eye over to get a better picture of Abeona Therapeutics.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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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