Insiders Sold US$2.6m Of Pacific Biosciences of California Stock Possibly Sending Warning Sign

Pacific Biosciences of California, Inc.'s (NASDAQ:PACB) stock rose 29% last week, but insiders who sold US$2.6m worth of stock over the last year are probably in a more advantageous position. Selling at an average price of US$6.37, which is higher than the current price might have been the right call as holding on to stock would have meant their investment would be worth less now than it was at the time of sale.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Pacific Biosciences of California

Pacific Biosciences of California Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the President, Christian O. Henry, for US$980k worth of shares, at about US$10.12 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The silver lining is that this sell-down took place above the latest price (US$1.80). So it may not shed much light on insider confidence at current levels.

In total, Pacific Biosciences of California insiders sold more than they bought over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.

Insiders At Pacific Biosciences of California Have Sold Stock Recently

The last quarter saw substantial insider selling of Pacific Biosciences of California shares. In total, insiders sold US$106k worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Insider Ownership Of Pacific Biosciences of California

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Based on our data, Pacific Biosciences of California insiders have about 0.6% of the stock, worth approximately US$2.6m. I generally like to see higher levels of ownership.

So What Does This Data Suggest About Pacific Biosciences of California Insiders?

Insiders sold stock recently, but they haven't been buying. And our longer term analysis of insider transactions didn't bring confidence, either. 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! So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Every company has risks, and we've spotted 4 warning signs for Pacific Biosciences of California (of which 1 is a bit unpleasant!) you should know about.

Of course Pacific Biosciences of California 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.