Insiders who bought into Kinnate Biopharma Inc. (NASDAQ:KNTE) earlier this year might wish they'd invested more as stock gained 16%

Last week, Kinnate Biopharma Inc. (NASDAQ:KNTE) insiders, who had purchased shares in the previous 12 months were rewarded handsomely. The shares increased by 16% last week, resulting in a US$59m increase in the company's market worth. In other words, the original US$339k purchase is now worth US$382k.

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.

Our analysis indicates that KNTE is potentially overvalued!

Kinnate Biopharma Insider Transactions Over The Last Year

The Chief Medical Officer Richard Williams made the biggest insider purchase in the last 12 months. That single transaction was for US$339k worth of shares at a price of US$8.64 each. That implies that an insider found the current price of US$9.56 per share to be enticing. 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. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. Happily, the Kinnate Biopharma insider decided to buy shares at close to current prices. The only individual insider to buy over the last year was Richard Williams.

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!

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.

Does Kinnate Biopharma Boast High 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. We usually like to see fairly high levels of insider ownership. Kinnate Biopharma insiders own about US$33m worth of shares. That equates to 7.8% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At Kinnate Biopharma Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. But insiders have shown more of an appetite for the stock, over the last year. Insiders own shares in Kinnate Biopharma and we see no evidence to suggest they are worried about the future. 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 4 warning signs for Kinnate Biopharma you should be aware of, and 2 of them are potentially serious.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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, but not derivative transactions.

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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.