Those following along with Ardelyx, Inc. (NASDAQ:ARDX) will no doubt be intrigued by the recent purchase of shares by David Mott, Independent Chairman of the Board of the company, who spent a stonking US$997k on stock at an average price of US$4.62. Not only is that a big swing, but it increased their holding size by 18%, which is definitely great to see.
Ardelyx Insider Transactions Over The Last Year
In fact, the recent purchase by David Mott was the biggest purchase of Ardelyx shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to buy, at around the current price, which is US$5.12. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. In this case we're pleased to report that the insider bought shares at close to current prices. The only individual insider to buy over the last year was David Mott.
All up, insiders sold more shares in Ardelyx than they bought, over the last year. 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!
If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.
Insider Ownership Of Ardelyx
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Ardelyx insiders own about US$29m worth of shares. That equates to 2.4% of the company. 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 Ardelyx Insider Transactions Indicate?
The recent insider purchase is heartening. However, the longer term transactions are not so encouraging. The more recent transactions are a positive, but Ardelyx insiders haven't shown the sustained enthusiasm that we look for, although they do own a decent number of shares, overall. In short they are likely aligned with shareholders. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Ardelyx. In terms of investment risks, we've identified 2 warning signs with Ardelyx and understanding them should be part of your investment process.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.
