Should You Take Comfort From Insider Transactions At RAPT Therapeutics, Inc. (NASDAQ:RAPT)?

It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell RAPT Therapeutics, Inc. (NASDAQ:RAPT), you may well want to know whether insiders have been buying or selling.

What Is Insider Buying?

It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.

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

Check out our latest analysis for RAPT Therapeutics

The Last 12 Months Of Insider Transactions At RAPT Therapeutics

Over the last year, we can see that the biggest insider purchase was by Independent Chairman of the Board William Rieflin for US$162k worth of shares, at about US$16.22 per share. Even though the purchase was made at a significantly lower price than the recent price (US$22.29), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Over the last year, we can see that insiders have bought 17.65k shares worth US$360k. On the other hand they divested 821.00 shares, for US$16k. Overall, RAPT Therapeutics insiders were net buyers during the last year. Their average price was about US$20.37. Although they bought at below the recent share price, it is good to see that insiders are willing to invest in the company. 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!

RAPT Therapeutics is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insiders at RAPT Therapeutics Have Sold Stock Recently

The last three months saw some RAPT Therapeutics insider selling. Chief Scientific Officer Dirk Brockstedt divested only US$16k worth of shares in that time. It's not great to see insider selling, nor the lack of recent buyers. But the volume sold is so low that it really doesn't bother us.

Does RAPT Therapeutics Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It appears that RAPT Therapeutics insiders own 2.9% of the company, worth about US$16m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The RAPT Therapeutics Insider Transactions Indicate?

We did not see any insider buying in the last three months, but we did see selling. However, the sales are not big enough to concern us at all. But insiders have shown more of an appetite for the stock, over the last year. Overall we don't see anything to make us think RAPT Therapeutics insiders are doubting the company, and they do own shares. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing RAPT Therapeutics. Our analysis shows 4 warning signs for RAPT Therapeutics (1 is potentially serious!) and we strongly recommend you look at them before investing.

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.

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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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