Insider Buyers Lose US$18k As Gossamer Bio Sheds US$19m

Insiders who bought US$138.1k worth of Gossamer Bio, Inc.'s (NASDAQ:GOSS) stock at an average buy price of US$0.60 over the last year may be disappointed by the recent 14% decrease in the stock. Insiders invest with the hopes of seeing their money grow in value over time. However, as a result of recent losses, their initial investment is now only worth US$119.9k, which is not what they expected.

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.

See our latest analysis for Gossamer Bio

Gossamer Bio Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when COO & CFO Bryan Giraudo bought US$113k worth of shares at a price of US$0.56 per share. That means that an insider was happy to buy shares at above the current price of US$0.52. 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. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

Over the last year, we can see that insiders have bought 232.00k shares worth US$138k. But insiders sold 45.88k shares worth US$55k. Overall, Gossamer Bio insiders were net buyers 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!

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).

Insiders At Gossamer Bio Have Sold Stock Recently

The last quarter saw substantial insider selling of Gossamer Bio shares. In total, insiders sold US$52k worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Insider Ownership

Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Based on our data, Gossamer Bio insiders have about 3.0% of the stock, worth approximately US$3.5m. We prefer to see high levels of insider ownership.

So What Do The Gossamer Bio Insider Transactions Indicate?

Insiders haven't bought Gossamer Bio stock in the last three months, but there was some selling. On the other hand, the insider transactions over the last year are encouraging. Still, insiders don't own a great deal of the stock. So the company doesn't look great on this analysis. 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. At Simply Wall St, we've found that Gossamer Bio has 4 warning signs (2 shouldn't be ignored!) that deserve your attention before going any further with your analysis.

Of course Gossamer Bio 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com