Chimeric Therapeutics' Market Cap Drops To AU$473k Leaving Insiders With Losses
The recent 33% drop in Chimeric Therapeutics Limited's (ASX:CHM) stock could come as a blow to insiders who purchased AU$3.00m worth of stock at an average buy price of AU$0.30 over the past 12 months. Insiders purchase with the hope of seeing their investments increase in value over time. However, due to recent losses, their initial investment is now only worth AU$40.0k, which is not great.
Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.
Chimeric Therapeutics Insider Transactions Over The Last Year
The insider Yekaterina Chudnovsky made the biggest insider purchase in the last 12 months. That single transaction was for AU$2.1m worth of shares at a price of AU$0.30 each. That means that even when the share price was higher than AU$0.004 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. The only individual insider to buy over the last year was Yekaterina Chudnovsky.
Yekaterina Chudnovsky bought 10.00m shares over the last 12 months at an average price of AU$0.30. 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!
View our latest analysis for Chimeric Therapeutics
There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insider Ownership
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with 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. It appears that Chimeric Therapeutics insiders own 15% of the company, worth about AU$73k. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At Chimeric Therapeutics Tell Us?
It doesn't really mean much that no insider has traded Chimeric Therapeutics shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. Insiders own shares in Chimeric Therapeutics and we see no evidence to suggest they are worried about the future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. At Simply Wall St, we found 6 warning signs for Chimeric Therapeutics that deserve your attention before buying any shares.
Of course Chimeric Therapeutics 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 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.