It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell Mustang Bio, Inc. (NASDAQ:MBIO), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, such insiders must disclose their trading activities, and not trade on inside information.
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 Mustang Bio
In the last twelve months, the biggest single purchase by an insider was when Non-Executive Director Lindsay Rosenwald bought US$221k worth of shares at a price of US$4.41 per share. That means that even when the share price was higher, an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. It’s not at all bad to see insiders buy shares at or above current prices.
Happily, we note that in the last year insiders bought 81.50k shares for a total of US$339k. In total, Mustang Bio insiders bought more than they sold over the last year. Their average price was about US$4.16. These transactions suggest that insiders have considered the current price of US$3.29 attractive. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Insiders at Mustang Bio Have Bought Stock Recently
Over the last quarter, Mustang Bio insiders have spent a meaningful amount on shares. In total, insiders bought US$339k worth of shares in that time, and we didn’t record any sales whatsoever. This could be interpreted as suggesting a positive outlook.
Insider Ownership of Mustang Bio
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Our data suggests Mustang Bio insiders own 1.2% of the company, worth about US$1.0m. I generally like to see higher levels of ownership.
So What Does This Data Suggest About Mustang Bio Insiders?
The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss last year, which makes us a little cautious. While the overall levels of insider ownership are below what we’d like to see, the history of transactions imply that Mustang Bio insiders are reasonably well aligned, and optimistic for the future. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Mustang Bio.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at email@example.com.