Yahoo Finance Are Insiders Buying Cassava Sciences, Inc. (NASDAQ:SAVA) Stock?
We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So shareholders might well want to know whether insiders have been buying or selling shares in Cassava Sciences, Inc. (NASDAQ:SAVA).
What Is Insider Selling?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, rules govern insider transactions, and certain disclosures are required.
We don't think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.
Check out our latest analysis for Cassava Sciences
Cassava Sciences Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Independent Director Sanford Robertson for US$932k worth of shares, at about US$2.20 per share. We do like to see buying, but this purchase was made at well below the current price of US$9.65. 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.
Cassava Sciences insiders may have bought shares in the last year, but they didn't sell any. They paid about US$2.70 on average. It is certainly positive to see that insiders have invested their own money in the company. However, we do note that they were buying at significantly lower prices than today's share price. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Insiders at Cassava Sciences Have Bought Stock Recently
It's good to see that Cassava Sciences insiders have made notable investments in the company's shares. Overall, three insiders shelled out US$1.7m for shares in the company -- and none sold. This could be interpreted as suggesting a positive outlook.
Does Cassava Sciences Boast High Insider Ownership?
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Cassava Sciences insiders own 14% of the company, worth about US$23m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
So What Do The Cassava Sciences Insider Transactions Indicate?
It is good to see recent purchasing. 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 Cassava Sciences 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 Cassava Sciences, you should check out this free report on analyst forecasts for the company.
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.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.
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