Selling Sera Prognostics Shares at a Lower Price Than Current Market Value May Have Been a Costly Mistake for Insiders

Despite the fact that Sera Prognostics, Inc.'s (NASDAQ:SERA) value has dropped 14% in the last week insiders who sold US$1.5m worth of stock in the past 12 months have had less success. Given that the average selling price of US$5.13 is still lower than the current share price, insiders would probably have been better off keeping their shares.

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.

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Sera Prognostics Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the President, Evguenia Lindgardt, for US$194k worth of shares, at about US$7.41 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is US$2.70. So it may not tell us anything about how insiders feel about the current share price.

Sera Prognostics insiders didn't buy any shares over the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

See our latest analysis for Sera Prognostics

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

Insiders At Sera Prognostics Have Sold Stock Recently

Over the last three months, we've seen significant insider selling at Sera Prognostics. Specifically, insiders ditched US$157k worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.

Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Based on our data, Sera Prognostics insiders have about 4.1% of the stock, worth approximately US$4.2m. We prefer to see high levels of insider ownership.

So What Does This Data Suggest About Sera Prognostics Insiders?

Insiders sold stock recently, but they haven't been buying. And there weren't any purchases to give us comfort, over the last year. When you consider that most companies have higher levels of insider ownership, we're a little wary. So we'd only buy after very careful consideration. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Be aware that Sera Prognostics is showing 6 warning signs in our investment analysis, and 3 of those make us uncomfortable...

Of course Sera Prognostics 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.