Despite the fact that Pacific Biosciences of California, Inc. (NASDAQ:PACB) stock rose 13% last week, insiders who sold US$1.8m worth of stock in the previous 12 months are likely to be better off. Selling at an average price of US$4.38, which is higher than the current price, may have been the best move for these insiders because 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 would consider it foolish to ignore insider transactions altogether.

The Last 12 Months Of Insider Transactions At Pacific Biosciences of California

Notably, that recent sale by President Christian O. Henry was not the only time they sold Pacific Biosciences of California shares this year. Earlier in the year, they fetched US$5.96 per share in a -US$481k sale. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is US$2.04. So it is hard to draw any strong conclusion from it.

Over the last year we saw more insider selling of Pacific Biosciences of California shares, than buying. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

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.

Insiders At Pacific Biosciences of California Have Sold Stock Recently

Over the last three months, we've seen significant insider selling at Pacific Biosciences of California. Specifically, insiders ditched US$278k worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.

Does Pacific Biosciences of California Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Based on our data, Pacific Biosciences of California insiders have about 0.6% of the stock, worth approximately US$3.0m. We consider this fairly low insider ownership.

So What Does This Data Suggest About Pacific Biosciences of California Insiders?

Insiders haven't bought Pacific Biosciences of California stock in the last three months, but there was some selling. And our longer term analysis of insider transactions didn't bring confidence, either. When you consider that most companies have higher levels of insider ownership, we're a little wary. So we're not rushing to buy, to say the least. 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. Case in point: We've spotted 4 warning signs for Pacific Biosciences of California you should be aware of, and 1 of these is significant.

Of course Pacific Biosciences of California may not be the best stock to buy. So you may wish to see this free collection of high quality 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.