In the last year, multiple insiders have substantially increased their holdings of Summit Therapeutics Inc. (NASDAQ:SMMT) stock, indicating that insiders’ optimism about the company’s prospects has increased.
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.
The Last 12 Months Of Insider Transactions At Summit Therapeutics
In the last twelve months, the biggest single purchase by an insider was when CEO & Executive Chairman Robert Duggan bought US$92m worth of shares at a price of US$0.97 per share. Even though the purchase was made at a significantly lower price than the recent price (US$3.55), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn’t tell us much about whether insiders might find today’s price attractive.
In the last twelve months Summit Therapeutics insiders were buying shares, but not selling. 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!
Summit Therapeutics is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insider Ownership Of Summit Therapeutics
Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Summit Therapeutics insiders own about US$638m worth of shares (which is 81% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
What Might The Insider Transactions At Summit Therapeutics Tell Us?
It doesn’t really mean much that no insider has traded Summit Therapeutics shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. With high insider ownership and encouraging transactions, it seems like Summit Therapeutics insiders think the business has merit. In addition to knowing about insider transactions going on, it’s beneficial to identify the risks facing Summit Therapeutics. Case in point: We’ve spotted 4 warning signs for Summit Therapeutics you should be aware of.
If you would prefer to check out another company — one with potentially superior financials — then do not miss this free list of interesting companies, that have HIGH return on equity 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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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.
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