It is not uncommon to see companies perform well in the years after insiders buy shares. On the other hand, we’d be remiss not to mention that insider sales have been known to precede tough periods for a business. So shareholders might well want to know whether insiders have been buying or selling shares in Ligand Pharmaceuticals Incorporated (NASDAQ:LGND).
What Is Insider Selling?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.
Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. As Peter Lynch said, ‘insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.’
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The Last 12 Months Of Insider Transactions At Ligand Pharmaceuticals
Over the last year, we can see that the biggest insider sale was by the Independent Director, Sunil Patel, for US$3.7m worth of shares, at about US$240 per share. While we don’t usually like to see insider selling, it’s more concerning if the sales take price at a lower price. The silver lining is that this sell-down took place above the latest price (US$115). So it is hard to draw any strong conclusion from it.
All up, insiders sold more shares in Ligand Pharmaceuticals than they bought, over the last year. The chart below shows insider transactions (by individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Ligand Pharmaceuticals Insiders Bought Stock Recently
Over the last three months, we’ve seen significant insider buying at Ligand Pharmaceuticals. John Higgins spent US$569k on stock, and there wasn’t any selling. That shows some optimism about the company’s future.
Insider Ownership of Ligand Pharmaceuticals
For a common shareholder, it is worth checking how many shares are held by company 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. Insiders own 3.1% of Ligand Pharmaceuticals shares, worth about US$71m. While this is a strong but not outstanding level of insider ownership, it’s enough to indicate some alignment between management and smaller shareholders.
So What Does This Data Suggest About Ligand Pharmaceuticals Insiders?
It is good to see the recent insider purchase. But we can’t say the same for the transactions over the last 12 months. We don’t take much heart from transactions by Ligand Pharmaceuticals insiders over the last year. But they own a reasonable amount of the company, and there was some buying recently. In short they are likely aligned with shareholders. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Ligand Pharmaceuticals.
But note: Ligand Pharmaceuticals 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.
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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.