This Insider Has Just Sold Shares In Ligand Pharmaceuticals

We wouldn't blame Ligand Pharmaceuticals Incorporated (NASDAQ:LGND) shareholders if they were a little worried about the fact that Jason Aryeh, the Independent Director recently netted about US$676k selling shares at an average price of US$320. However, that sale only accounted for 1.9% of their holding, so arguably it doesn't say much about their conviction.

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The Last 12 Months Of Insider Transactions At Ligand Pharmaceuticals

Notably, that recent sale by Independent Director Jason Aryeh was not the only time they sold Ligand Pharmaceuticals shares this year. Earlier in the year, they fetched US$250 per share in a -US$1.2m sale. That means that even when the share price was below the current price of US$306, an insider wanted to cash in some shares. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 4.7% of Jason Aryeh's holding.

In the last year Ligand Pharmaceuticals insiders didn't buy any company stock. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

See our latest analysis for Ligand Pharmaceuticals

I will like Ligand Pharmaceuticals better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

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. We usually like to see fairly high levels of insider ownership. Ligand Pharmaceuticals insiders own about US$137m worth of shares (which is 2.2% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At Ligand Pharmaceuticals Tell Us?

Insiders sold stock recently, but they haven't been buying. And there weren't any purchases to give us comfort, over the last year. But it is good to see that Ligand Pharmaceuticals is growing earnings. 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. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Ligand Pharmaceuticals. For instance, we've identified 3 warning signs for Ligand Pharmaceuticals (1 shouldn't be ignored) you should be aware of.

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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.

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