Investing

New Year's Insider Buying Focuses on Biotechs

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As the year got underway, biotechs were in focus among the notable insider purchases. Two of them were companies focused on treatments for the eye. Meanwhile, a chief executive who is a serial buyer made a return trip to the buy window to bolster his stake.

A well-known adage reminds us that corporate insiders and 10% owners really only buy shares of a company because they believe the stock price will rise and they want to profit from it. Thus, insider buying can be an encouraging signal for potential investors. This is all the more so during times of uncertainty in the markets, and even when markets are near all-time highs.

Remember that as a new earnings-reporting season gets underway, many insiders are prohibited from buying or selling shares. Below are some of the more notable insider purchases that were reported since the beginning of the year.

Jumping on a Dyne Therapeutics Public Offering

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  • Buyer(s): director
  • Total shares: over 1.7 million
  • Price per share: $17.50
  • Total cost: just shy of $30.0 million

This director’s stake of more than 6.41 million Dyne Therapeutics Inc. (NASDAQ: DYN) shares makes the director a beneficial owner. Unfortunately, shares of this biotech were last seen trading about a dollar below that public offering share price. However, it is more than 25% higher than before positive trial results were recently announced. Note that CEO Joshua Brum sold less than 220,000 shares recently. And the consensus price target is up at $35 a share.

Insider Likes the Look of EyePoint Pharmaceuticals

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  • Buyer(s): 10% owner Cormorant Asset Management
  • Total shares: 855,000
  • Price per share: $19.75 to $21.50
  • Total cost: around $17.0 million

Like Staar Surgical (see below), this biotech is focused on treatments for the eye. EyePoint Pharmaceuticals Inc. (NASDAQ: EYPT) shared positive trial results back in December, and shares are up about 16% since then and were last seen still trading within the buyer’s purchase price range. The buyer’s stake is up to more than 6.89 million shares. Note that an officer sold some shares recently as well. The $41.67 consensus price target indicates that analysts think the stock could nearly double in the next year.

Buying From a Voxx International Insider

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  • Buyer(s): a director
  • Total shares: less than 1.6 million
  • Price per share: $10
  • Total cost: almost $15.7 million

An executive of Voxx International Corp. (NASDAQ: VOXX) sold these shares pursuant to a stock purchase agreement. Shares of this Orlando-based consumer electronics maker tumbled despite this week’s better than expected quarterly results and were last seen trading below $9 apiece. However, the stock is still up about 15% since the 52-week low of $7.25 seen back in October. Note that the director is also the CEO of auto components maker Gentex Corp. (NASDAQ: GNTX), and that director’s stake in Voxx is up to 3.31 million shares.

A Focus on Staar Surgical

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  • Buyer(s): 10% owner Broadwood Partners
  • Total shares: about 230,600
  • Price per share: $27.04 to $28.99
  • Total cost: almost $6.6 million

This beneficial owner returned to acquire more Staar Surgical Co. (NASDAQ: STAA) shares. The maker of implantable lenses for the eye posted better than expected quarterly results early in November, and it has been under pressure to spin off its business in Asia. The stock popped about 17% in the past week to more than $33 per share, after hitting a 52-week low of $27.00. The consensus price target is up at $43.13, and analysts on average recommend buying shares.

Opko Health Sees a Flury of Interest

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  • Buyer(s): CEO Phillip Frost and other executives and directors
  • Total shares: almost 3.0 million
  • Price per share: $0.85 to $0.95
  • Total cost: over $2.7 million

The stock is down more than 27% since Opko Health Inc. (NASDAQ: OPK) posted mixed quarterly results back in November. The low end of that purchase price range is the same as the 52-week low, and shares were last seen trading just above the top of that range. Note that Frost is a serial buyer of Opko shares. So far this month, he has scooped up more than 2.01 million shares, and his stake of nearly 204 million shares makes him a 10% owner. Analysts see some room for the stock to run, given their consensus price target of $4.33. Their consensus recommendation is to buy shares. (Here are 17 things you didn’t know your pharmacist could do.)

Changes Coming for Evolve Transition Infrastructure

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  • Buyer(s): 10% owner Stonepeak G.P.
  • Total shares: over 1.5 million
  • Price per share: about $1.39
  • Total cost: more than $2.1 million

Note that Houston-based midstream and production company Evolve Transition Infrastructure L.P. (NYSE: SNMP) will soon go private, as the general partner has elected to exercise the right to purchase all of the issued and outstanding common units for a cash purchase price of nearly $1.39. Units were last seen changing hands near that price, in a 52-week range of $0.42 to $13.81.

And Other Insider Buying

Since the beginning of the year, some insider buying was reported at Adobe, Casey’s General Stores, Consolidated Edison, Curtiss-Wright, Simon Property Group and Walgreens Boots Alliance as well.

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