Turn Therapeutics Reaches US$132m Market Cap Benefiting Insider Stock Buying
Last week, Turn Therapeutics Inc. (NASDAQ:TTRX) insiders, who had purchased shares in the previous 12 months were rewarded handsomely. The shares increased by 16% last week, resulting in a US$19m increase in the company's market worth, implying a 19% gain on their initial purchase. Put another way, the original US$242.7k acquisition is now worth US$288.4k.
While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
The Last 12 Months Of Insider Transactions At Turn Therapeutics
Over the last year, we can see that the biggest insider purchase was by Independent Director Arthur Golden for US$100k worth of shares, at about US$4.95 per share. That means that an insider was happy to buy shares at above the current price of US$4.57. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
In the last twelve months Turn Therapeutics insiders were buying shares, but not selling. The average buy price was around US$3.85. We don't deny that it is nice to see insiders buying stock in the company. But we must note that the investments were made at well below today's share price. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
See our latest analysis for Turn 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).
Turn Therapeutics Insiders Bought Stock Recently
Over the last quarter, Turn Therapeutics insiders have spent a meaningful amount on shares. Not only was there no selling that we can see, but they collectively bought US$243k worth of shares. This makes one think the business has some good points.
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. Turn Therapeutics insiders own 59% of the company, currently worth about US$79m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Does This Data Suggest About Turn Therapeutics Insiders?
It is good to see recent purchasing. And the longer term insider transactions also give us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. When combined with notable insider ownership, these factors suggest Turn Therapeutics insiders are well aligned, and quite possibly think the share price is too low. Looks promising! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For instance, we've identified 4 warning signs for Turn Therapeutics (3 are concerning) you should be aware of.
But note: Turn Therapeutics may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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 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.