Despite the fact that Ginkgo Bioworks Holdings, Inc. (NYSE:DNA) stock rose 21% last week, insiders who sold US$1.7m worth of stock in the previous 12 months are likely to be better off. Selling at an average price of US$0.95, which is higher than the current price, may have been the wisest decision for these insiders as their investment would have been worth less now than when they sold.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.
The Last 12 Months Of Insider Transactions At Ginkgo Bioworks Holdings
In the last twelve months, the biggest single sale by an insider was when the insider, Marijn Dekkers, sold US$1.6m worth of shares at a price of US$0.93 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The silver lining is that this sell-down took place above the latest price (US$0.38). So it is hard to draw any strong conclusion from it.
Over the last year, we can see that insiders have bought 922.62k shares worth US$787k. But insiders sold 1.77m shares worth US$1.7m. All up, insiders sold more shares in Ginkgo Bioworks Holdings than they bought, over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
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Ginkgo Bioworks Holdings Insiders Are Selling The Stock
We've seen more insider selling than insider buying at Ginkgo Bioworks Holdings recently. In that time, insider Marijn Dekkers dumped US$1.6m worth of shares. On the flip side, insiders spent US$787k on purchasing shares (as mentioned above) . We don't view these transactions as a positive sign.
Insider Ownership
Many investors like to check how much of a company is owned by 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's great to see that Ginkgo Bioworks Holdings insiders own 17% of the company, worth about US$141m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
What Might The Insider Transactions At Ginkgo Bioworks Holdings Tell Us?
The insider sales have outweighed the insider buying, at Ginkgo Bioworks Holdings, in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. At Simply Wall St, we found 4 warning signs for Ginkgo Bioworks Holdings that deserve your attention before buying any shares.
But note: Ginkgo Bioworks Holdings 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com