RVL Pharmaceuticals plc (NASDAQ:RVLP) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 26%, resulting in a US$65m rise in the company's market capitalisation. In other words, the original US$1.7m purchase is now worth US$2.2m.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for RVL Pharmaceuticals

RVL Pharmaceuticals Insider Transactions Over The Last Year

In fact, the recent purchase by Brian Markison was the biggest purchase of RVL Pharmaceuticals shares made by an insider individual in the last twelve months, according to our records. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$1.98. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

While RVL Pharmaceuticals insiders bought shares during the last year, they didn't sell. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.

Insiders At RVL Pharmaceuticals Have Bought Stock Recently

Over the last three months, we've seen significant insider buying at RVL Pharmaceuticals. Not only was there no selling that we can see, but they collectively bought US$1.6m worth of shares. This could be interpreted as suggesting a positive outlook.

Insider Ownership Of RVL Pharmaceuticals

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Our data indicates that RVL Pharmaceuticals insiders own about US$7.0m worth of shares (which is 3.6% of the company). We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. We do generally prefer see higher levels of insider ownership.

What Might The Insider Transactions At RVL Pharmaceuticals Tell Us?

It is good to see recent purchasing. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. On this analysis the only slight negative we see is the fairly low (overall) insider ownership; their transactions suggest that they are quite positive on RVL Pharmaceuticals stock. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 1 warning sign for RVL Pharmaceuticals you should be aware of.

But note: RVL Pharmaceuticals 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, but not derivative transactions.

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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.

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