Possible Bearish Signals With Amphastar Pharmaceuticals Insiders Disposing Stock

Over the past year, many Amphastar Pharmaceuticals, Inc. (NASDAQ:AMPH) insiders sold a significant stake in the company which may have piqued investors' interest. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, if numerous insiders are selling, shareholders should investigate more.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for Amphastar Pharmaceuticals

Amphastar Pharmaceuticals Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the insider, Michael Zasloff, sold US$590k worth of shares at a price of US$47.53 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$50.82. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. It is worth noting that this sale was only 40% of Michael Zasloff's holding.

Amphastar Pharmaceuticals insiders didn't buy any shares over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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).

Amphastar Pharmaceuticals Insiders Are Selling The Stock

The last quarter saw substantial insider selling of Amphastar Pharmaceuticals shares. Specifically, insider Floyd Petersen ditched US$139k worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.

Does Amphastar Pharmaceuticals Boast High Insider Ownership?

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Amphastar Pharmaceuticals insiders own about US$210m worth of shares (which is 8.5% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The Amphastar Pharmaceuticals Insider Transactions Indicate?

An insider hasn't bought Amphastar Pharmaceuticals stock in the last three months, but there was some selling. Looking to the last twelve months, our data doesn't show any insider buying. On the plus side, Amphastar Pharmaceuticals makes money, and is growing profits. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Every company has risks, and we've spotted 1 warning sign for Amphastar Pharmaceuticals you should know about.

Of course Amphastar Pharmaceuticals 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.