- Insider buying can be an encouraging signal for potential investors when markets face uncertainty.
- Insiders seemed to be focused on biotech companies last week.
- Initial public offerings and a SPAC merger encouraged insiders to buy shares.
Conventional wisdom says that insiders and 10% owners really only buy shares of a company for one reason -- they believe the stock price will rise and they want to profit from it. So insider buying can be an encouraging signal for potential investors, particularly when markets are near all-time highs.
Insiders continued to add shares despite market volatility and economic uncertainty. Here are some of the most noteworthy insider purchases reported in the past week.
Cancer-focused biopharmaceutical company Oncorus Inc ONCR saw two directors and four beneficial owners take advantage of its initial public offering priced at $15 per share. One director acquired a million of those shares, more than doubling his stake. The others bought 975,000 shares altogether, and all these transactions totaled over $29.62 million. Shares closed Friday at $15.66.
Last week, the second-largest Precigen Inc PGEN shareholder voluntarily converted a convertible note with an outstanding principal balance of $25 million to increase its stake in this cellular therapy developer by almost 6.76 million to nearly 27.40 million shares, or almost 15% of all outstanding shares. In addition, a few executives sold some shares back in mid-September.
Special purpose acquisition company Churchill Capital III Corp CCXX had two directors increase their stakes ahead of its merger with medical payment company MultiPlan Corporation MPLN. The more than 701,700 shares were indirectly purchased altogether at $10.10 to $10.48 per share. That totaled more than $9.92 million. MultiPlan shares ended the week trading at $9.82 apiece.
The executive board chair at Element Solutions Inc ESI, Martin Franklin, purchased 500,000 shares via trust of this diversified specialty chemicals company for $11.50 a piece. That cost him $5.75 million. Note that another director added 8,000 shares in mid-September for about the same price. The stock ended last week at $12.21, more than 6% above these purchase prices.
Two directors added over 3.23 million Selecta Biosciences Inc SELB shares combined to their stakes last week. Prices ranged from $1.55 to $1.90 per share, and the purchases cost them around $5.53 million. Shares closed most recently at $2.02, after the Massachusetts-based company entered a license agreement last week for a kidney disease treatment.
Four Pulmonx Corp LUNG directors purchased 81,500 shares altogether of this California-based medical devices maker. At the IPO price of $19 per share, that came to about $1.55 million. The stock soared out of the gate, hitting a high of $52 a share, before closing on Friday at $42.25. That was still a gain for the week of more than 122%.
A director at Immunome Inc IMNM picked up more than 83,300 shares of this biotech company in the initial public offering early last week. At $12 per share, that came to nearly $1.00 million. His stake in this cancer-focused company was listed as up to more than 638,800 shares. The stock ended the week at $13.91 per share, which represents about a 16% gain for that director.
Newly public avocado producer and distributor Mission Produce, Inc AVO saw CEO Stephen Barnard, another executive and three directors step up to the buy window. Altogether, around 52,500 shares were acquired for $12 each, the IPO price. That totaled about $630,000. Note that Barnard's stake is over 2 million shares, and the stock ended the week trading at $12.50.
In addition, some smaller amount of insider buying in Amazon.com, Inc. AMZN, Amicus Therapeutics, Inc. FOLD, Consolidated Edison, Inc. ED, Medtronic PLC MDT, Texas Pacific Land Trust TPL and Terex Corporation TEX was reported last week as well.
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