Insider Sellers Might Regret Selling Disc Medicine Shares at a Lower Price Than Current Market Value

Disc Medicine, Inc.'s (NASDAQ:IRON) stock price has dropped 11% in the previous week, but insiders who sold US$887k in stock over the past year have had less luck. The average selling price of US$54.58 is still lower than the current share price, or in other words, insiders would have been better off holding on to their shares.

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.

We've discovered 4 warning signs about Disc Medicine. View them for free.

The Last 12 Months Of Insider Transactions At Disc Medicine

Over the last year, we can see that the biggest insider sale was by the CEO, President & Director, John Quisel, for US$304k worth of shares, at about US$54.58 per share. While insider selling is a negative, to us, it is more negative if the shares are sold 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$44.24. So it is hard to draw any strong conclusion from it.

In the last year Disc Medicine insiders didn't buy any company stock. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

See our latest analysis for Disc Medicine

I will like Disc Medicine better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Disc Medicine Insiders Are Selling The Stock

The last three months saw significant insider selling at Disc Medicine. In total, insiders dumped US$887k 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

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. From our data, it seems that Disc Medicine insiders own 0.5% of the company, worth about US$7.7m. We do generally prefer see higher levels of insider ownership.

What Might The Insider Transactions At Disc Medicine Tell Us?

Insiders haven't bought Disc Medicine stock in the last three months, but there was some selling. Looking to the last twelve months, our data doesn't show any insider buying. When you consider that most companies have higher levels of insider ownership, we're a little wary. We'd certainly practice some caution before buying! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Disc Medicine. To help with this, we've discovered 4 warning signs (2 are a bit concerning!) that you ought to be aware of before buying any shares in Disc Medicine.

But note: Disc Medicine 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.