Relay Therapeutics Chief Corporate Development Officer Peter Rahmer Sells 63% Of Holding

Anyone interested in Relay Therapeutics, Inc. (NASDAQ:RLAY) should probably be aware that the Chief Corporate Development Officer, Peter Rahmer, recently divested US$133k worth of shares in the company, at an average price of US$4.15 each. In particular, we note that the sale equated to a 63% reduction in their position size, which doesn't exactly instill confidence.

View our latest analysis for Relay Therapeutics

The Last 12 Months Of Insider Transactions At Relay Therapeutics

In fact, the recent sale by Peter Rahmer was the biggest sale of Relay Therapeutics shares made by an insider individual in the last twelve months, according to our records. That means that an insider was selling shares at slightly below the current price (US$4.83). As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. It is worth noting that this sale was 63% of Peter Rahmer's holding.

In the last year Relay Therapeutics insiders didn't buy any company stock. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.

Insider Ownership Of Relay 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. We usually like to see fairly high levels of insider ownership. Relay Therapeutics insiders own about US$13m worth of shares. That equates to 1.7% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Does This Data Suggest About Relay Therapeutics Insiders?

Insiders sold stock recently, but they haven't been buying. And even if we look at the last year, we didn't see any purchases. Insiders own shares, but we're still pretty cautious, given the history of sales. So we'd only buy after careful consideration. 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 Relay Therapeutics has 3 warning signs and it would be unwise to ignore them.

But note: Relay 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.