Have Insiders Been Buying PLx Pharma Inc. (NASDAQ:PLXP) Shares?

We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we'll take a look at whether insiders have been buying or selling shares in PLx Pharma Inc. (NASDAQ:PLXP).

What Is Insider Selling?

Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. 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 equally, we would consider it foolish to ignore insider transactions altogether. 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'.

See our latest analysis for PLx Pharma

PLx Pharma Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Executive Chairman Michael Valentino bought US$1.0m worth of shares at a price of US$3.79 per share. We do like to see buying, but this purchase was made at well below the current price of US$7.00. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

PLx Pharma insiders may have bought shares in the last year, but they didn't sell any. 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!

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.

Have PLx Pharma Insiders Traded Recently?

There was some insider buying at PLx Pharma over the last quarter. Independent Director John Hadden shelled out US$5.4k for shares in that time. We like it when there are only buyers, and no sellers. However, in this case the amount invested recently is quite small.

Does PLx Pharma Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. From looking at our data, insiders own US$3.4m worth of PLx Pharma stock, about 2.2% of the company. We prefer to see high levels of insider ownership.

So What Does This Data Suggest About PLx Pharma Insiders?

We note a that there has been a bit of insider buying recently (but no selling). The net investment is not enough to encourage us much. But insiders have shown more of an appetite for the stock, over the last year. We'd like to see bigger individual holdings. However, we don't see anything to make us think PLx Pharma insiders are doubting the company. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Every company has risks, and we've spotted 4 warning signs for PLx Pharma (of which 2 are significant!) you should know about.

But note: PLx Pharma 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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