Fulcrum Therapeutics Insider Purchases Yet To Pay Off Regardless Of Recent Strength

Some of the losses seen by insiders who purchased US$492.0k worth of Fulcrum Therapeutics, Inc. (NASDAQ:FULC) shares over the past year were recovered after the stock increased by 22% over the past week. However, the purchase is proving to be an expensive wager as insiders are yet to get ahead of their losses which currently stand at US$307k since the time of purchase.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

View our latest analysis for Fulcrum Therapeutics

Fulcrum Therapeutics Insider Transactions Over The Last Year

The CEO, President & Director Alexander Sapir made the biggest insider purchase in the last 12 months. That single transaction was for US$492k worth of shares at a price of US$11.35 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$4.27). While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. In our view, the price an insider pays for shares is very important. 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. Alexander Sapir was the only individual insider to buy during 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!

Fulcrum Therapeutics is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Does Fulcrum Therapeutics 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. I reckon it's a good sign if insiders own a significant number of shares in the company. Based on our data, Fulcrum Therapeutics insiders have about 1.6% of the stock, worth approximately US$3.5m. I generally like to see higher levels of ownership.

So What Do The Fulcrum Therapeutics Insider Transactions Indicate?

The fact that there have been no Fulcrum Therapeutics insider transactions recently certainly doesn't bother us. However, our analysis of transactions over the last year is heartening. While we have no worries about the insider transactions, we'd be more comfortable if they owned more Fulcrum Therapeutics 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. Case in point: We've spotted 3 warning signs for Fulcrum Therapeutics you should be aware of, and 2 of them are a bit unpleasant.

But note: Fulcrum Therapeutics may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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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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.