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We often see insiders buying up shares in companies that perform well over the long term. On the other hand, we’d be remiss not to mention that insider sales have been known to precede tough periods for a business. So before you buy or sell XOMA Corporation (NASDAQ:XOMA), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, such insiders must disclose their trading activities, and not trade on inside information.
Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
XOMA Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when CEO & Director James Neal bought US$53k worth of shares at a price of US$13.26 per share. That means that an insider was happy to buy shares at around the current price of US$15.12. Of course they may have changed their mind. But this suggests they are optimistic. While we always like to see insider buying, it’s less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. In this case we’re pleased to report that the insider bought shares at close to current prices. The only individual insider to buy over the last year was James Neal.
You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Have XOMA Insiders Traded Recently?
In the last quarter Chairman of the Board & Lead Independent Director W. Van Ness sold US$1.9k worth of equity. That’s not a lot. The net selling is so small that it’s hard to draw any conclusions from these recent transactions.
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. Our data isn’t picking up on much insider ownership at XOMA, though insiders do hold about US$891k worth of shares. We might be missing something but that seems like very low insider ownership.
So What Does This Data Suggest About XOMA Insiders?
We did not see any insider buying in the last three months, but we did see selling. But given the selling was modest, we’re not worried. On a brighter note, the transactions over the last year are encouraging. While we have no worries about the insider transactions, we’d be more comfortable if they owned more XOMA stock. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
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.
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