Don't Ignore The Fact That This Insider Just Sold Some Shares In Invitae Corporation (NYSE:NVTA)

By
Simply Wall St
Published
March 21, 2021
NYSE:NVTA

We wouldn't blame Invitae Corporation (NYSE:NVTA) shareholders if they were a little worried about the fact that Sean George, the Co-Founder recently netted about US$1.2m selling shares at an average price of US$42.90. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 5.0%.

Check out our latest analysis for Invitae

Invitae Insider Transactions Over The Last Year

The Director, Jason Myers, made the biggest insider sale in the last 12 months. That single transaction was for US$3.4m worth of shares at a price of US$47.32 each. So what is clear is that an insider saw fit to sell at around the current price of US$41.37. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign.

Insiders in Invitae didn't buy any shares in the last year. You can see a visual depiction of insider transactions (by companies and 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!

insider-trading-volume
NYSE:NVTA Insider Trading Volume March 21st 2021

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Insider Ownership of Invitae

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Invitae insiders own about US$176m worth of shares (which is 2.2% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Invitae Insiders?

Insiders haven't bought Invitae 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. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Case in point: We've spotted 3 warning signs for Invitae you should be aware of, and 1 of these is concerning.

Of course Invitae may not be the best stock to buy. So you may wish to see this free collection of high quality 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, but not derivative transactions.

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This article by Simply Wall St is general in nature. 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.
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