Adverum Biotechnologies Up 22%, Insiders Still Down After US$526.8k Purchase

Insiders who purchased US$526.8k worth of Adverum Biotechnologies, Inc. (NASDAQ:ADVM) shares over the past year recouped some of their losses after price gained 22% last week. However, the purchase is proving to be a costly gamble, since losses made by insiders have totalled US$188k since the time of purchase.

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 Adverum Biotechnologies

Over the last year, we can see that the biggest insider purchase was by insider Braden Leonard for US$189k worth of shares, at about US$5.19 per share. That means that even when the share price was higher than US$2.73 (the recent price), an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. The only individual insider to buy over the last year was Braden Leonard.

Braden Leonard bought 124.00k shares over the last 12 months at an average price of US$4.25. 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!

View our latest analysis for Adverum Biotechnologies

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

Adverum Biotechnologies Insiders Bought Stock Recently

Over the last three months, we've seen significantly more insider buying, than insider selling, at Adverum Biotechnologies. In total, insider Braden Leonard bought US$149k worth of shares in that time. But we did see insider selling worth US$26k. The buying outweighs the selling, which suggests that insiders may believe the company will do well in the future.

Does Adverum Biotechnologies Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 12% of Adverum Biotechnologies shares, worth about US$6.4m, according to our data. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!

What Might The Insider Transactions At Adverum Biotechnologies Tell Us?

The recent insider purchase is heartening. We also take confidence from the longer term picture of insider transactions. But on the other hand, the company made a loss during the last year, which makes us a little cautious. On this analysis the only slight negative we see is the fairly low (overall) insider ownership; their transactions suggest that they are quite positive on Adverum Biotechnologies stock. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. When we did our research, we found 6 warning signs for Adverum Biotechnologies (3 don't sit too well with us!) that we believe deserve your full attention.

Of course Adverum Biotechnologies 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 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.