Multiple Insiders Sold Exagen Shares Presenting Weak Signs For Investors

Exagen Inc. (NASDAQ:XGN) shareholders may have reason to be concerned, as several insiders sold their shares over the past year. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, shareholders should take a deeper look if several insiders are selling stock over a specific time period.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Exagen

The Last 12 Months Of Insider Transactions At Exagen

In the last twelve months, the biggest single sale by an insider was when the CEO, President & Director, John Aballi, sold US$59k worth of shares at a price of US$1.75 per share. That means that an insider was selling shares at below the current price (US$1.77). When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. This single sale was just 18% of John Aballi's stake.

Insiders in Exagen didn't buy any shares in the last year. 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!

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Exagen Insiders Are Selling The Stock

The last three months saw some Exagen insider selling. CFO & Corporate Secretary Kamal Adawi divested only US$38k worth of shares in that time. It's not great to see insider selling, nor the lack of recent buyers. But the amount sold isn't enough for us to put any weight on it.

Insider Ownership Of Exagen

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. From our data, it seems that Exagen insiders own 10% of the company, worth about US$3.2m. We do generally prefer see higher levels of insider ownership.

What Might The Insider Transactions At Exagen Tell Us?

Our data shows a little more insider selling, but no insider buying, in the last three months. But given the selling was modest, we're not worried. Recent sales exacerbate our caution arising from analysis of Exagen insider transactions. We also note that, as far as we can see, insider ownership is fairly low, compared to other companies. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Exagen. You'd be interested to know, that we found 5 warning signs for Exagen and we suggest you have a look.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.