Don't Ignore The Fact That This Insider Just Sold Some Shares In Puma Biotechnology, Inc. (NASDAQ:PBYI)

We note that the Puma Biotechnology, Inc. (NASDAQ:PBYI) Chief Medical & Scientific Officer, Richard Bryce, recently sold US$67k worth of stock for US$10.23 per share. It wasn't a huge sale, but it did reduce their holding by 15%. This does not instill confidence.

View our latest analysis for Puma Biotechnology

The Last 12 Months Of Insider Transactions At Puma Biotechnology

The Independent Director, Troy Wilson, made the biggest insider sale in the last 12 months. That single transaction was for US$252k worth of shares at a price of US$9.97 each. That means that an insider was selling shares at slightly below the current price (US$11.39). When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was 97% of Troy Wilson's stake.

Puma Biotechnology 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!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).

Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Puma Biotechnology insiders own 13% of the company, worth about US$59m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Does This Data Suggest About Puma Biotechnology Insiders?

Insiders sold stock recently, but they haven't been buying. And even if we look at the last year, we didn't see any purchases. While insiders do own shares, they don't own a heap, and they have been selling. We'd 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. While conducting our analysis, we found that Puma Biotechnology has 2 warning signs and it would be unwise to ignore them.

But note: Puma Biotechnology 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.

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. 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.
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