Prime Medicine's Market Cap Up US$161m Following Year Of Insider Stock Buying

Prime Medicine, Inc. (NASDAQ:PRME) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 28%, resulting in a US$161m rise in the company's market capitalisation, translating to a gain of 263% on their initial investment. Put another way, the original US$283.9k acquisition is now worth US$1.03m.

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.

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Prime Medicine Insider Transactions Over The Last Year

The CEO & Director Allan Reine made the biggest insider purchase in the last 12 months. That single transaction was for US$147k worth of shares at a price of US$1.18 each. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$4.21. 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 Prime Medicine insiders bought shares during the last year, they didn't sell. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

See our latest analysis for Prime Medicine

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

Insider Ownership

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that Prime Medicine insiders own 15% of the company, worth about US$112m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Do The Prime Medicine Insider Transactions Indicate?

The fact that there have been no Prime Medicine insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. Judging from their transactions, and high insider ownership, Prime Medicine insiders feel good about the company's future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Prime Medicine. Our analysis shows 3 warning signs for Prime Medicine (1 doesn't sit too well with us!) and we strongly recommend you look at these before investing.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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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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.