Insider Stock Buying Reaches US$1.48m On OmniAb

Over the last year, a good number of insiders have significantly increased their holdings in OmniAb, Inc. (NASDAQ:OABI). This is encouraging because it indicates that insiders are more optimistic about the company’s prospects.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

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Over the last year, we can see that the biggest insider purchase was by President Matthew Foehr for US$1m worth of shares, at about US$1.85 per share. That means that an insider was happy to buy shares at above the current price of US$1.59. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. Notably Matthew Foehr was also the biggest seller.

Over the last year, we can see that insiders have bought 790.29k shares worth US$1.5m. But they sold 82.83k shares for US$268k. In total, OmniAb insiders bought more than they sold over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

View our latest analysis for OmniAb

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

Over the last three months, we’ve seen significant insider buying at OmniAb. President Matthew Foehr spent US$1m on stock, and there wasn’t any selling. This is a positive in our book as it implies some confidence.

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. OmniAb insiders own about US$28m worth of shares. That equates to 12% of the company. While this is a strong but not outstanding level of insider ownership, it’s enough to indicate some alignment between management and smaller shareholders.

It’s certainly positive to see the recent insider purchase. And the longer term insider transactions also give us confidence. But we don’t feel the same about the fact the company is making losses. Given that insiders also own a fair bit of OmniAb we think they are probably pretty confident of a bright future. So while it’s helpful to know what insiders are doing in terms of buying or selling, it’s also helpful to know the risks that a particular company is facing. You’d be interested to know, that we found 2 warning signs for OmniAb and we suggest you have a look.

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 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.