Possible Bearish Signals With Amphastar Pharmaceuticals Insiders Disposing Stock

In the last year, many Amphastar Pharmaceuticals, Inc. (NASDAQ:AMPH) insiders sold a substantial stake in the company which may have sparked shareholders' attention. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Amphastar Pharmaceuticals

The Last 12 Months Of Insider Transactions At Amphastar Pharmaceuticals

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. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is US$35.70. So it is hard to draw any strong conclusion from it.

Amphastar Pharmaceuticals insiders didn't buy any shares 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!

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 three months saw significant insider selling at Amphastar Pharmaceuticals. In total, Lead Independent Director Richard Prins sold US$122k 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.

Insider Ownership Of Amphastar Pharmaceuticals

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's great to see that Amphastar Pharmaceuticals insiders own 8.1% of the company, worth about US$139m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Do The Amphastar Pharmaceuticals Insider Transactions Indicate?

An insider sold stock recently, but they haven't been buying. And there weren't any purchases to give us comfort, over the last year. On the plus side, Amphastar Pharmaceuticals makes money, and is growing profits. It is good to see high insider ownership, but the insider selling leaves us cautious. 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. Every company has risks, and we've spotted 1 warning sign for Amphastar Pharmaceuticals you should know about.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.