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. Bar FDA officials, who else has the best information about these events? Insiders, especially executives and directors of the companies.
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.
The following companies had insider purchases Wednesday.
CytRx Corporation (NASDAQ:CYTR) is a healthcare company, specifically in the industry of biotechnology. It is a biopharmaceutical research and development company specializing in oncology. Its drug development pipeline includes INNO-206, which is in Phase Ib clinical trial and is completing Phase Ib/II clinical trial. It has a market cap of $87.57 million. According to Wednesday's SEC filing, CytRx has one insider who purchased a total of 16,493 shares at the total value of $75,111. The company is currently losing money operationally. Its business has to turnaround for the situation to become more positive. The recent trading volume is below average. The price history shows positive market expectations.
PROLOR Biotech, Inc. (NYSEMKT:PBTH) is a healthcare company, specifically in the industry of biotechnology. It is a development stage biopharmaceutical company engaging in the development of proprietary versions of already-approved therapeutic proteins. It has a market cap of $270.44 million. According to Wednesday's SEC filing, PROLOR Biotech has one insider who purchased a total of 5,000 shares at the total value of $24,045. Thinning trading volume suggests that trading interest in the company is waning.
United Therapeutics Corporation (NASDAQ:UTHR) is a healthcare company, specifically in the industry of drug manufacturers. It is a biotechnology company, engaging in the development and commercialization of therapeutic products for patients with chronic and life-threatening diseases in the United States and internationally. It has a market cap of $2.57 billion. According to Wednesday's SEC filing, United Therapeutics has one insider who purchased a total of 4,138 shares at the total value of $198,363. Given that its price is only 19.55% lower than its 52-week high, the overall market sentiment appears positive. Based on its PEG ratio of 0.39, the stock appears undervalued. I like United Therapeutics' operating margin of 50.04%, a good sign for the company's financial health. The recent trading volume is below average. My thoughts: This is a relatively safe play.
Source of business information: Yahoo Finance
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.