In this article, I will feature one biotech stock that has seen intensive insider buying during the last 30 days. Intensive insider buying can be defined by the following three criteria:
- The stock is purchased by three or more insiders within one month.
- The stock is sold by no insiders in the month of intensive purchasing.
- At least two purchasers increased their holdings by more than 10%.
Synta Pharmaceuticals (NASDAQ:SNTA) focuses on the discovery, development, and commercialization of small molecule drugs for treating severe medical conditions, including cancer and chronic inflammatory diseases.
Insider buying during the last 30 days
Here is a table of Synta's insider-trading activity during the last 30 days by insider.
|Name||Title||Trade Date||Shares Purchased||Public Offering||Current Ownership||Increase In Shares|
|Safi Bahcall||CEO||Nov 13||20,000||Yes||2,053,135 shares||+1.0%|
|William Reardon||Director||Nov 13||13,333||Yes||36,561 shares||+57.4%|
|Keith Gollust||Director||Nov 13||150,000||Yes||3,330,638 shares||+4.7%|
|Bruce Kovner||Director||Nov 13||5,000,000||Yes||28,641,849 shares||+21.1%|
There have been 5,183,333 shares purchased by insiders during the last 30 days.
Insider buying by calendar month
Here is a table of Synta's insider-trading activity by calendar month.
|Month||Insider buying / shares||Insider selling / shares|
There have been 8,353,333 shares purchased and there have been zero shares sold by insiders this year. The month of November has seen the most insider buying.
Synta reported the third-quarter financial results on November 4 with the following highlights:
|Net loss||$22.5 million|
On November 13, 2013, Synta priced a public offering of 14,000,000 shares of its common stock at a price to the public of $3.75 per share. Gross proceeds to Synta are expected to be approximately $52.5 million.
Pipeline and upcoming catalysts
Synta has the following upcoming catalysts:
|GALAXY-1||Overall survival results by early 2014.|
|GALAXY-2||Interim analyses in H2/2014, final analysis in H1/2015.|
|ENCHANT-1||Initial results in December 2013.|
Synta doesn't have any revenues yet.
Here is a table of these competitors' insider-trading activities this year.
|Company||Insider buying / shares||Insider selling / shares|
Only Synta has seen intensive insider buying during the last 30 days.
There have been four different insiders buying Synta and there have not been any insiders selling Synta during the last 30 days. Two of these four insiders increased their holdings by more than 10%.
The insiders purchased their shares after the GALAXY-1 trial results at $3.75 share price pursuant to the public offering. The next catalyst for the stock will be the initial results from the ENCHANT-1 trial, which will be presented at the San Antonio Breast Cancer Symposium in December of this year.
There are five analyst buy ratings, three neutral ratings, and zero sell ratings with an average price target of $15.83. I believe the stock could be a good speculative pick from the current price level based on the intensive insider buying.
Disclosure: I am long EXEL. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.