Possible bearish signals as Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) insiders disposed of US$16m worth of stock

In the last year, many Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) insiders sold a substantial stake in the company which may have sparked shareholders' attention. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, if numerous insiders are selling, shareholders should investigate more.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

See our latest analysis for Regeneron Pharmaceuticals

Regeneron Pharmaceuticals Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Independent Director, George Sing, sold US$7.0m worth of shares at a price of US$660 per share. That means that an insider was selling shares at slightly below the current price (US$688). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. We note that the biggest single sale was only 23% of George Sing's holding.

Regeneron Pharmaceuticals insiders didn't buy any shares over the last year. 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!

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Regeneron Pharmaceuticals Insiders Are Selling The Stock

The last three months saw significant insider selling at Regeneron Pharmaceuticals. Specifically, Independent Director Arthur Ryan ditched US$4.3m worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.

Does Regeneron Pharmaceuticals Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Regeneron Pharmaceuticals insiders own 4.2% of the company, currently worth about US$3.1b based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Does This Data Suggest About Regeneron Pharmaceuticals Insiders?

An insider hasn't bought Regeneron Pharmaceuticals stock in the last three months, but there was some selling. Looking to the last twelve months, our data doesn't show any insider buying. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. While we like knowing 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. In terms of investment risks, we've identified 2 warning signs with Regeneron Pharmaceuticals and understanding these should be part of your investment process.

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.

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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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