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Should You Take Comfort From Insider Transactions At Kalytera Therapeutics, Inc. (CVE:KLY)?

Simply Wall St

We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So shareholders might well want to know whether insiders have been buying or selling shares in Kalytera Therapeutics, Inc. (CVE:KLY).

What Is Insider Selling?

Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, most countries require that the company discloses such transactions to the market.

Insider transactions are not the most important thing when it comes to long-term investing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.

See our latest analysis for Kalytera Therapeutics

The Last 12 Months Of Insider Transactions At Kalytera Therapeutics

Over the last year, we can see that the biggest insider purchase was by CEO, President & Director Robert Farrell for CA$99k worth of shares, at about CA$0.05 per share. That means that even when the share price was higher than CA$0.045 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

While Kalytera Therapeutics insiders bought shares last year, they didn't sell. The chart below shows insider transactions (by individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

TSXV:KLY Recent Insider Trading, December 16th 2019

Kalytera Therapeutics is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Does Kalytera Therapeutics Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Our data isn't picking up on much insider ownership at Kalytera Therapeutics, though insiders do hold about CA$143k worth of shares. We might be missing something but that seems like very low insider ownership.

So What Do The Kalytera Therapeutics Insider Transactions Indicate?

The fact that there have been no Kalytera Therapeutics insider transactions recently certainly doesn't bother us. However, our analysis of transactions over the last year is heartening. The transactions are fine but it'd be more encouraging if Kalytera Therapeutics insiders bought more shares in the company. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Kalytera Therapeutics.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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, but not derivative transactions.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.