Possible Bearish Signals With Regeneron Pharmaceuticals Insiders Disposing Stock

In the last year, many Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) insiders sold a substantial stake in the company which may have sparked shareholders' attention. When evaluating insider transactions, knowing whether insiders are buying is usually more beneficial than knowing whether they are selling, as the latter can be open to many interpretations. However, if numerous insiders are selling, shareholders should investigate more.

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

See our latest analysis for Regeneron Pharmaceuticals

Regeneron Pharmaceuticals Insider Transactions Over The Last Year

The Executive VP and GM of Industrial Operations & Product Supply, Daniel Van Plew, made the biggest insider sale in the last 12 months. That single transaction was for US$9.8m worth of shares at a price of US$952 each. That means that even when the share price was below the current price of US$991, an insider wanted to cash in some shares. 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 just 24% of Daniel Van Plew's stake.

Insiders in Regeneron Pharmaceuticals didn't buy any shares in the last year. 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!

I will like Regeneron Pharmaceuticals better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Regeneron Pharmaceuticals Insiders Are Selling The Stock

The last three months saw significant insider selling at Regeneron Pharmaceuticals. Specifically, insiders ditched US$12m worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Insider Ownership Of Regeneron Pharmaceuticals

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. Regeneron Pharmaceuticals insiders own about US$4.3b worth of shares (which is 4.0% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The Regeneron Pharmaceuticals Insider Transactions Indicate?

Insiders haven't bought Regeneron Pharmaceuticals stock in the last three months, but there was some selling. And even if we look at the last year, we didn't see any purchases. On the plus side, Regeneron Pharmaceuticals makes money, and is growing profits. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. While conducting our analysis, we found that Regeneron Pharmaceuticals has 1 warning sign and it would be unwise to ignore this.

Of course Regeneron Pharmaceuticals may not be the best stock to buy. So you may wish to see this free collection of high quality 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 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.