Finance

Are AVEO Pharmaceuticals, Inc. (AVEO)’s Recent Ownership and Insider Trends a Sign of Things to Come?

Recent insider trends for AVEO Pharmaceuticals, Inc. (NASDAQ:AVEO) have caught the attention of investors. Analysts monitor insider data to understand the sentiment of a company’s largest and most important shareholders. AVEO’s insider trading patterns have some implications for where the stock might be headed.

Institutions own 54.27% of AVEO Pharmaceuticals, Inc. (AVEO)’s shares. The total value of these holdings, in millions, is $190. Among active positions in the latest quarter, 50 holders increased their positions by a total of 14.41 million shares, 20 holders decreased the positions by a total of 11.16 million shares, and 11 holders held their positions. This works out to a net increase in ownership of 3.25 million shares, and suggests that institutions are feeling bullish about the stock.

Among new and sold out positions, 26 holders initiated new positions by a total of 8.59 million shares and 8 holders exited their positions by a total of 1.88 million shares. This nets out to an increase of 6.71 million shares and is a bullish sign for AVEO.

Insider ownership increased by a total of 0 shares, which suggests that AVEO’s key executives are feeling more optimistic about the outlook for the stock. The data from the past twelve months tells a similar story: insiders executed 13 buys and 1 sells, and ownership increased by a net of 60.39 million shares.



The analysis of insider buying and selling trends can be extended to the aggregate level. Short interest, which represents the number of a stock’s shares currently being shorted, captures what the market as a whole feels about a stock. AVEO Pharmaceuticals, Inc. (NASDAQ:AVEO)’s short interest is 7.09 million shares, or 7.89% of the float. This represents a decrease of -5% in the number of shares being shorted compared to the previous reading, and implies that investors felt less pessimistic about the stock during the past two weeks.

Insider data can help an investor form an outlook on a stock, but it’s important to supplement this data with other information such as technical indicators to form a more complete view. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that AVEO is a Weak buy, which implies that AVEO is expected to outperform the market based on prior trading patterns.

Conclusion




Institutional ownership trends suggest that the stock is cheap and the insider trading data indicates that insiders are bullish. Technical indicators (also) suggest that AVEO Pharmaceuticals, Inc. (NASDAQ:AVEO) is undervalued.

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