Some Incyte Corporation (NASDAQ:INCY) shareholders may be a little concerned to see that the Executive VP & GM of North America, Barry Flannelly, recently sold a substantial US$1.1m worth of stock at a price of US$60.00 per share. That diminished their holding by a very significant 63%, which arguably implies a strong desire to reallocate capital.
The Last 12 Months Of Insider Transactions At Incyte
Over the last year, we can see that the biggest insider sale was by the Executive VP & Chief Medical Officer, Steven Stein, for US$1.4m worth of shares, at about US$63.28 per share. So we know that an insider sold shares at around the present share price of US$62.11. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.
Insiders in Incyte didn't buy any shares in the last year. 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!
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Insider Ownership Of Incyte
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. 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 0.5% of Incyte shares, worth about US$73m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Do The Incyte Insider Transactions Indicate?
Insiders sold Incyte shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. But it is good to see that Incyte is growing earnings. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. So we'd only buy after careful consideration. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. While conducting our analysis, we found that Incyte has 1 warning sign and it would be unwise to ignore it.
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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.
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