This Insider Has Just Sold Shares In Relay Therapeutics

Some Relay Therapeutics, Inc. (NASDAQ:RLAY) shareholders may be a little concerned to see that the CEO, President & Director, Sanjiv Patel, recently sold a substantial US$818k worth of stock at a price of US$3.80 per share. That's a big disposal, and it decreased their holding size by 15%, which is notable but not too bad.

Check out our latest analysis for Relay Therapeutics

Relay Therapeutics Insider Transactions Over The Last Year

Notably, that recent sale by Sanjiv Patel is the biggest insider sale of Relay Therapeutics shares that we've seen in the last year. That means that an insider was selling shares at slightly below the current price (US$4.00). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. 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. We note that the biggest single sale was only 15% of Sanjiv Patel's holding.

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

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Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. Relay Therapeutics insiders own about US$12m worth of shares. That equates to 1.8% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At Relay Therapeutics Tell Us?

Insiders sold Relay Therapeutics shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. 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. Be aware that Relay Therapeutics is showing 4 warning signs in our investment analysis, and 1 of those is a bit unpleasant...

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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.