Insider Buying: The Rain Therapeutics Inc. (NASDAQ:RAIN) Co-Founder Just Bought US$57k Worth Of Shares

Whilst it may not be a huge deal, we thought it was good to see that the Rain Therapeutics Inc. (NASDAQ:RAIN) Co-Founder, Avanish Vellanki, recently bought US$57k worth of stock, for US$2.29 per share. Nevertheless, it only increased their shareholding by a minuscule percentage, and it wasn't a massive purchase by absolute value, either.

See our latest analysis for Rain Therapeutics

The Last 12 Months Of Insider Transactions At Rain Therapeutics

Notably, that recent purchase by Avanish Vellanki is the biggest insider purchase of Rain Therapeutics shares that we've seen in the last year. So it's clear an insider wanted to buy, at around the current price, which is US$2.50. That means they have been optimistic about the company in the past, though they may have changed their mind. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. The good news for Rain Therapeutics share holders is that insiders were buying at near the current price.

In the last twelve months Rain Therapeutics insiders were buying shares, but not selling. Their average price was about US$3.87. These transactions suggest that insiders have considered the current price attractive. 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 always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insider Ownership of Rain Therapeutics

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. From our data, it seems that Rain Therapeutics insiders own 15% of the company, worth about US$9.7m. Whilst better than nothing, we're not overly impressed by these holdings.

So What Do The Rain Therapeutics Insider Transactions Indicate?

It is good to see the recent insider purchase. 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. While the overall levels of insider ownership are below what we'd like to see, the history of transactions imply that Rain Therapeutics insiders are reasonably well aligned, and optimistic for the 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. For example, Rain Therapeutics has 5 warning signs (and 2 which are a bit concerning) we think you should know about.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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, but not derivative transactions.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.