SYRS

Insider Buying Week 12-29-23 Here We go Again with Rampant Speculation

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Here we go again, two insider buys in small biotech names that rocketed 43% and 76% last week.  This didn’t happen in a vacuum. For the last two months or so,  the daily top 50 largest percentage gainers and losers are filled with small-cap and bulletin board names you’ve never heard of, ripping up and down 40%-150% in a shark-like blood-infested feeding frenzy. The list is composed mostly of obscure biotech stocks, pre-revenue or little revenue shells, SPACS, and cryptocurrency names, scams, and fantasies inspired by occasional real biotech transactions, the most notable being the 273% premium Sanofi paid for … Read more

Notable Insider Buys and Sales Week Ending 4-19-19

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It was a dull week for insider trading, duller even than the miserly week before.  Last week would make you think it was a crime to buy your own company’s stock.   Of course, we are in the throes of the 1st quarter earnings blackout, but insiders still find ways to unload their holdings though. There were a couple of noteworthy buys.

Buys

JPM JPMorgan Chase & Co (Mkt Cap: $338.9B) – Director Mellody Hobson Mellody steps up buying JPM after the stock bounced 5% on 1st quarter earnings surprise, spending $2.2M to purchase 19,700 at $111.30. This increased her holdings by 31.2%.  That might have meant something but six insiders also sold $28.1 million worth.

LAWS Lawson Products (Mkt Cap: $274.0M) Chairman of the Board, John King must have liked what he saw as he bought $1.2M worth of stock after the Company reported a healthy leap in earnings. Lawson Products(LAWS), a product supplier to the maintenance, repair, and operations market, reported Q1 adjusted earnings of $0.48 per share, up from $0.25 in the same period a year ago and topping the estimate of $0.29 from analysts polled by Capital IQ.

Total revenue of $91.3 million was up from $84.4 million in the same period ending in March a year ago and topped the Street projection of $89.8 million.

Sales
BBY Best Buy  Perhaps things aren’t as sunny as we think at Best Buy. Two insiders sold $19.9 million worth of stock in outright sales, including Chairman Joly’s sale of 171,711 shares at $73.68.

Not much of interest here either. Insiders continue to unload stock using the Rule 10b5-1 loophole that allows insiders to sell stock right through any imposed earnings blackout period. It’s hard to read anything much into these sales other than the fact, that I would rather see insiders buying than selling their stock. The timing of these transactions shed little light on short term price movements, though.

In this report, we examined open market purchases from employees and directors.  Insiders sell stock for many reasons, but they generally buy for just one – to make money.  As a standard, we only look at material amounts of money, $200 thousand or more, as anything less could just be window dressing. The bar is different from selling because the natural state of management is to be sellers. This is because most companies provide significant amounts of management compensation packages as stock. Therefore, with selling, we analyze for unusual patterns, such as insiders selling 25 percent or more of their holdings or multiple insiders selling near 52-week lows. Another red flag is large planned sale programs that start without warning. We generally ignore 10 percent shareholders as they tend to be OPM (other people’s money) and not the SMART money we are trying to go to school on.  Although this info is available for free from the SEC’s Web site, Edgar, we subscribe to the Washington Service as they provide a way to manage and make sense of the vast realms of data.

To learn more about our strategy, visit our website here. We welcome your comments on our analysis. We may own positions, long or short, in any of these names and are under no obligation to disclose that. If you would like to hear more about how you can get involved with the Insiders Fund, please schedule some time on my calendar

 

Notable Insider Buys and Sales Week Ending 4-12-19

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It was a dull week for insider trading, duller even than the dull week before.  Last week would make you think it was a crime to buy your own company’s stock.   Of course, we are in the throes of the 1st quarter earnings blackout, but insiders still find ways to unload their holdings though.

Buys

ABEO Abeo Therapeutics Two directors bought stock in this biotech.  One was a first time purchase for a sizeable amount. We normally don’t think much of new directors buys as this is pretty much a riskless transaction as they will get paid in compensation as much as they might be expected to buy.  Director Buono bought 70,000 shares at $7.80 per share and that’s worth noticing.
Abeona Therapeutics announced that the FDA has granted fast track designation to ABO-101, the company’s novel one-time gene therapy for Sanfilippo syndrome type B, or MPS IIIB. ABO-101 is designed to deliver a functional copy of the NAGLU gene to the central nervous system and peripheral tissues. Abeona is enrolling eligible patients with MPS IIIB at sites in the U.S. and Spain and expects to activate additional sites globally this year to accelerate enrollment.
But the story gets thicker and particularly thornier;
wrote in January 2017 that ABEO Director Mark Ahn appears to have settled an SEC investigation for his involvement in an illegal stock promotion when he served as the CEO of Galena Pharmaceuticals (GALE).

Before being sued, Ahn allegedly promoted GALE with illegal stock promotion campaigns costing hundreds of thousands of dollars, then dumped millions of dollars of his stock, enriching himself.

This is not surprising to us as ABEO’s board is filled with stock promoters, including Chairman Steven Rouhandeh, who has a long and similar history of promotion and self-enrichment.

Two sell-side “analysts” defending ABEO were involved in numerous China fraud wipeouts while at Rodman & Renshaw.

It doesn’t appear that this director is working there any longer and to the company’s credit, new director Buono comes with good credentials but most importantly he is buying $546,000 dollars worth of good credit. Among Mr. Buono’s many accomplishments was bringing AAA public in November 2015, on the NASDAQ exchange. The company traded under the ticker symbol AAAP, until it was acquired by Novartis in January 2018.

LNDC Landec Director Obus doubled down on his currently losing hand by purchasing 60,000 shares at $10.33.  Landec does a lot of things as taken from its 10k: Landec Corporation, together with its subsidiaries, designs, develops, manufactures, and sells differentiated health and wellness products for food and biomaterials markets. It operates through two segments, Packaged Fresh Vegetables and Biomaterials.  Revenue and Debt have risen while profits have shrunk, not a pretty picture.
TCDA Tricinda Director Parker bought 20,000 shares at $36. Tricida, Inc., a pharmaceutical company, focuses on the development and commercialization of its drug candidate, TRC101, a non-absorbed, orally-administered polymer designed as a potential treatment for metabolic acidosis in patients with chronic kidney disease (CKD). It has completed a Phase 3, double-blind, placebo-controlled trial of TRC101 in patients with CKD and metabolic acidosis.
SYRS Pharmaceuticals Director Srinivas increased his holdings by 50% purchasing 533,332 shares at $7.50 spending $4 million dollars in an underwritten offering. Piper Jaffray was one of the underwriters and their analyst Edward Tenthoff lowered his price target for Syros Pharmaceuticals to $24 from $28 to account for dilution of the company’s recent $70M capital raise. The analyst, however, reiterates an Overweight rating on the name. Syros is developing potentially best-in-class CDK7 inhibitors, Tenthoff tells investors in a research note. He points out that data from the expansion cohorts in ovarian cancer are expected in Q4.
Sales

Not much of interest here either. Insiders continue to unload stock using the Rule 10b5-1 loophole that allows insiders to sell stock right through any imposed earnings blackout period. It’s hard to read anything much into these sales other than the fact, that I would rather see insiders buying than selling their stock. The timing of these transactions shed little light on short term price movements, though.

In this report, we examined open market purchases from employees and directors.  Insiders sell stock for many reasons, but they generally buy for just one – to make money.  As a standard, we only look at material amounts of money, $200 thousand or more, as anything less could just be window dressing. The bar is different from selling because the natural state of management is to be sellers. This is because most companies provide significant amounts of management compensation packages as stock. Therefore, with selling, we analyze for unusual patterns, such as insiders selling 25 percent or more of their holdings or multiple insiders selling near 52-week lows. Another red flag is large planned sale programs that start without warning. We generally ignore 10 percent shareholders as they tend to be OPM (other people’s money) and not the SMART money we are trying to go to school on.  Although this info is available for free from the SEC’s Web site, Edgar, we subscribe to the Washington Service as they provide a way to manage and make sense of the vast realms of data.

To learn more about our strategy, visit our website here. We welcome your comments on our analysis. We may own positions, long or short, in any of these names and are under no obligation to disclose that. If you would like to hear more about how you can get involved with the Insiders Fund, please schedule some time on my calendar