Stock Analysis

This Insider Has Just Sold Shares In Vanda Pharmaceuticals Inc. (NASDAQ:VNDA)

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Anyone interested in Vanda Pharmaceuticals Inc. (NASDAQ:VNDA) should probably be aware that the Senior Vice President of Business Development, Gunther Birznieks, recently divested US$374k worth of shares in the company, at an average price of US$18.28 each. The eyebrow raising move amounted to a reduction of 11% in their holding.

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The Last 12 Months Of Insider Transactions At Vanda Pharmaceuticals

Notably, that recent sale by Gunther Birznieks is the biggest insider sale of Vanda Pharmaceuticals shares that we've seen in the last year. That means that an insider was selling shares at around the current price of US$17.89. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. In this case, the big sale took place at around the current price, so it's not too bad (but it's still not a positive).

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

NasdaqGM:VNDA Insider Trading Volume March 4th 2021

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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. Vanda Pharmaceuticals insiders own about US$31m worth of shares. That equates to 3.2% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The Vanda Pharmaceuticals Insider Transactions Indicate?

Insiders haven't bought Vanda Pharmaceuticals stock in the last three months, but there was some selling. Looking to the last twelve months, our data doesn't show any insider buying. Insiders own shares, but we're still pretty cautious, given the history of sales. We'd practice some caution before buying! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Vanda Pharmaceuticals. While conducting our analysis, we found that Vanda Pharmaceuticals has 3 warning signs and it would be unwise to ignore these.

But note: Vanda 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, but not derivative transactions.

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