Healthcare companies, especially pharmaceuticals, medical devices, and biotech companies, often experience discrete sudden share movements due to unexpected events such as FDA drug approval or rejection, positive or negative results from drug tests, etc.
Healthcare companies, especially pharmaceuticals, medical devices, and biotech companies, often experience discrete sudden share movements due to unexpected events such as FDA drug approval or rejection, positive or negative results from drug tests, etc. Barring FDA officials, who else has the best information about these events? Insiders, especially executives and directors of the companies.
daibio-laboratory-6
It, therefore, can very lucrative to track insider activities in this industry. Moreover, since many biotech companies are not yet making money, the financial records are less diagnostic than events and technical indicators. This week, we track the following companies with insider purchases:
Celgene Corporation (CELG) is a biotechnology company. It has a market cap of $28.26 billion. Its stock closed at $64.16 per share on Friday. Over the past week, Celgene had one insider who bought a total of 600 shares at the total value of $36,174. Celgene has an enterprise value / EBITDA ratio of 13.18. Its profit margin was 29.34% over the past year.
I like Celgenes operating margin of 33.53%, a good sign for the companys financial health. The company had a net income of $1.46 billion and EBITDA of $2.01 billion on revenue of $4.99 billion. Both its revenue and earnings grew in double digits over the latest quarter, by 13.20% and 57.10%, respectively. Its operating cash flow is $1.84 billion, and its free cash flow is $1.39 billion. The trading volume has been stable recently. This is a large pharma with solid financials, I do not expect drastic changes albeit insider activity.
CytRx Corporation (CYTR) is a biotechnology company. It has a market cap of $97.11 million. Its stock closed at $4.58 per share on Friday. Over the past week, CytRx had one insider who bought a total of 67,993 shares at the total value of $347,714. The company is currently losing money operationally. Its business has to turnaround for the situation to become more positive.
According to seekingalpha