Shareholders Can't Ignore US$6.6m Of Sales By Apellis Pharmaceuticals Insiders

Apellis Pharmaceuticals, Inc.'s (NASDAQ:APLS) stock rose 13% last week, but insiders who sold US$6.6m worth of stock over the last year are probably in a more advantageous position. Selling at an average price of US$63.68, which is higher than the current price, may have been the wisest decision for these insiders as their investment would have been worth less now than when they sold.

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.

See our latest analysis for Apellis Pharmaceuticals

Apellis Pharmaceuticals Insider Transactions Over The Last Year

The Co-Founder, Cedric Francois, made the biggest insider sale in the last 12 months. That single transaction was for US$873k worth of shares at a price of US$65.00 each. 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$32.63. So it may not tell us anything about how insiders feel about the current share price.

In the last year Apellis Pharmaceuticals insiders didn't buy any company stock. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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Apellis Pharmaceuticals Insiders Are Selling The Stock

We have seen a bit of insider selling at Apellis Pharmaceuticals, over the last three months. VP, Corporate Controller & Chief Accounting Officer James Chopas only netted US$29k selling shares, in that period. 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. Apellis Pharmaceuticals insiders own 3.4% of the company, currently worth about US$133m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Apellis Pharmaceuticals Insiders?

Our data shows a little more insider selling, but no insider buying, in the last three months. But given the selling was modest, we're not worried. It's great to see high levels of insider ownership, but looking back over the last year, we don't gain confidence from the Apellis Pharmaceuticals insiders selling. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Apellis Pharmaceuticals. At Simply Wall St, we found 1 warning sign for Apellis Pharmaceuticals that deserve your attention before buying any shares.

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.