Insiders who sold US$2.7m worth of Humacyte, Inc. (NASDAQ:HUMA were amply compensated

By
Simply Wall St
Published
April 17, 2022
NasdaqGS:HUMA
Source: Shutterstock

Humacyte, Inc.'s (NASDAQ:HUMA) stock rose 11% last week, but insiders who sold US$2.7m worth of stock over the last year are probably in a more advantageous position. Selling at an average price of US$9.10, which is higher than the current price, may have been the best move for these insiders because 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, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for Humacyte

The Last 12 Months Of Insider Transactions At Humacyte

In the last twelve months, the biggest single sale by an insider was when the Director, Brady Dougan, sold US$2.7m worth of shares at a price of US$9.80 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. It's of some comfort that this sale was conducted at a price well above the current share price, which is US$7.37. So it may not tell us anything about how insiders feel about the current share price. Brady Dougan was the only individual insider to sell over the last year.

You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
NasdaqGS:HUMA Insider Trading Volume April 17th 2022

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).

Does Humacyte Boast High 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. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 13% of Humacyte shares, worth about US$98m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Does This Data Suggest About Humacyte Insiders?

It doesn't really mean much that no insider has traded Humacyte shares in the last quarter. Our analysis of Humacyte insider transactions leaves us cautious. But we do like the fact that insiders own a fair chunk of the company. While we like knowing 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 4 warning signs for Humacyte (of which 1 is significant!) 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, but not derivative transactions.

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