Insider Spends US$99k Buying More Shares In Prelude Therapeutics

Whilst it may not be a huge deal, we thought it was good to see that the Prelude Therapeutics Incorporated (NASDAQ:PRLD) Founder, Krishna Vaddi, recently bought US$99k worth of stock, for US$0.93 per share. However, it only increased their shares held by 4.9%, and it wasn't a huge purchase by absolute value, either.

View our latest analysis for Prelude Therapeutics

Prelude Therapeutics Insider Transactions Over The Last Year

In fact, the recent purchase by Krishna Vaddi was the biggest purchase of Prelude Therapeutics shares made by an insider individual in the last twelve months, according to our records. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$1.30. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Prelude Therapeutics 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 want to know exactly who sold, for how much, and when, simply click on the graph below!

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at 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. I reckon it's a good sign if insiders own a significant number of shares in the company. Our data indicates that Prelude Therapeutics insiders own about US$4.3m worth of shares (which is 6.0% of the company). We do generally prefer see higher levels of insider ownership.

So What Do The Prelude Therapeutics Insider Transactions Indicate?

It's certainly positive to see the recent insider purchases. And an analysis of the transactions over the last year also gives us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that Prelude Therapeutics insiders are expecting a bright future. 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. When we did our research, we found 5 warning signs for Prelude Therapeutics (1 is concerning!) that we believe deserve your full attention.

But note: Prelude Therapeutics 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 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.