Don't Ignore The Insider Selling In Natera

Some Natera, Inc. (NASDAQ:NTRA) shareholders may be a little concerned to see that the Lead Independent Director, Roelof Botha, recently sold a substantial US$15m worth of stock at a price of US$169 per share. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 6.7%.

Check out our latest analysis for Natera

Natera Insider Transactions Over The Last Year

In fact, the recent sale by Roelof Botha was the biggest sale of Natera shares made by an insider individual in the last twelve months, according to our records. That means that even when the share price was slightly below the current price of US$172, an insider wanted to cash in some shares. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. We note that the biggest single sale was only 6.7% of Roelof Botha's holding.

Natera insiders didn't buy any shares over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

I will like Natera 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.

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. Natera insiders own 3.4% of the company, currently worth about US$770m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Do The Natera Insider Transactions Indicate?

Insiders haven't bought Natera 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. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Natera. Case in point: We've spotted 2 warning signs for Natera you should be aware of.

Of course Natera may not be the best stock to buy. So you may wish to see this free collection of high quality 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 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.