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

Even though Skye Bioscience, Inc. (NASDAQ:SKYE) has fallen by 16% over the past week , insiders who sold US$1.2m worth of stock over the past year have had less luck. Insiders might have been better off holding onto their shares, given that the average selling price of US$4.99 is still below the current share price.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

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The Last 12 Months Of Insider Transactions At Skye Bioscience

In the last twelve months, the biggest single sale by an insider was when the Independent Chairman of the Board, Paul Grayson, sold US$432k worth of shares at a price of US$5.55 per share. While insider selling is a negative, to us, it is more negative if the shares are sold 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$2.05. So it is hard to draw any strong conclusion from it.

Skye Bioscience 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. By clicking on the graph below, you can see the precise details of each insider transaction!

See our latest analysis for Skye Bioscience

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Insider Ownership Of Skye Bioscience

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Based on our data, Skye Bioscience insiders have about 1.6% of the stock, worth approximately US$1.1m. We consider this fairly low insider ownership.

What Might The Insider Transactions At Skye Bioscience Tell Us?

It doesn't really mean much that no insider has traded Skye Bioscience shares in the last quarter. Our analysis of Skye Bioscience insider transactions leaves us unenthusiastic. And we're not picking up on high enough insider ownership to give us any comfort. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Skye Bioscience. Every company has risks, and we've spotted 5 warning signs for Skye Bioscience (of which 3 are concerning!) you should know about.

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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.