Summit Therapeutics Insider Buyers Pleased With US$24m Return On Investment

Insiders who bought Summit Therapeutics Inc. (NASDAQ:SMMT) stock lover the last 12 months are probably not as affected by last week’s 13% loss. After taking the recent loss into consideration, the US$5.84m worth of stock they bought is now worth US$30.2m, indicating that their investment yielded a positive return.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for Summit Therapeutics

Summit Therapeutics Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when COO, CFO & Director Manmeet Soni bought US$5.0m worth of shares at a price of US$1.68 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$9.40. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Summit Therapeutics insiders may have bought shares in the last year, but they didn't sell any. 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!

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insider Ownership Of Summit Therapeutics

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that Summit Therapeutics insiders own 81% of the company, worth about US$5.6b. 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 Does This Data Suggest About Summit Therapeutics Insiders?

It doesn't really mean much that no insider has traded Summit Therapeutics shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. Judging from their transactions, and high insider ownership, Summit Therapeutics insiders feel good about the company's future. 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. Case in point: We've spotted 4 warning signs for Summit Therapeutics you should be aware of, and 3 of these don't sit too well with us.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.