Maravai LifeSciences Holdings, Inc. (NASDAQ:MRVI) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 16%, resulting in a US$75m rise in the company's market capitalisation, translating to a gain of 14% on their initial investment. As a result, their original purchase of US$1.88m worth of stock is now worth US$2.15m.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
The CEO & Director Bernd Brust made the biggest insider purchase in the last 12 months. That single transaction was for US$809k worth of shares at a price of US$3.24 each. Even though the purchase was made at a significantly lower price than the recent price (US$3.79), we still think insider buying is a positive. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.
While Maravai LifeSciences Holdings insiders bought shares during the last year, they didn't sell. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
View our latest analysis for Maravai LifeSciences Holdings
Maravai LifeSciences Holdings is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.
It's good to see that Maravai LifeSciences Holdings insiders have made notable investments in the company's shares. Not only was there no selling that we can see, but they collectively bought US$1.9m worth of shares. This could be interpreted as suggesting a positive outlook.
For a common shareholder, it is worth checking how many shares are held by company 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. Insiders own 2.5% of Maravai LifeSciences Holdings shares, worth about US$24m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
It's certainly positive to see the recent insider purchases. And an analysis of the transactions over the last year also gives us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Insiders likely see value in Maravai LifeSciences Holdings shares, given these transactions (along with notable insider ownership of the company). Of course, the future is what matters most. So if you are interested in Maravai LifeSciences Holdings, you should check out this free report on analyst forecasts for the company.
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.
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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.