CEO & Director of Terns Pharmaceuticals Picks Up 98% More Stock

Even if it's not a huge purchase, we think it was good to see that Amy Burroughs, the CEO & Director of Terns Pharmaceuticals, Inc. (NASDAQ:TERN) recently shelled out US$90k to buy stock, at US$3.87 per share. While that isn't the hugest buy, it actually boosted their shareholding by 98%, which is good to see.

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Terns Pharmaceuticals Insider Transactions Over The Last Year

The Independent Director Hongbo Lu made the biggest insider purchase in the last 12 months. That single transaction was for US$5.0m worth of shares at a price of US$10.50 each. That means that an insider was happy to buy shares at above the current price of US$3.83. Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.

In the last twelve months insiders purchased 532.71k shares for US$5.3m. But insiders sold 25.95k shares worth US$157k. In total, Terns Pharmaceuticals insiders bought more than they sold 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!

View our latest analysis for Terns Pharmaceuticals

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Does Terns Pharmaceuticals Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. From what we can see in our data, insiders own only about US$861k worth of Terns Pharmaceuticals shares. It's always possible we are missing something but from our data, it looks like insider ownership is minimal.

So What Does This Data Suggest About Terns Pharmaceuticals Insiders?

It's certainly positive to see the recent insider purchases. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. On this analysis the only slight negative we see is the fairly low (overall) insider ownership; their transactions suggest that they are quite positive on Terns Pharmaceuticals stock. 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 Terns Pharmaceuticals is showing 4 warning signs in our investment analysis, and 3 of those are concerning...

But note: Terns Pharmaceuticals 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.