Recent insider trends for BioAmber Inc. (NYSE:BIOA) have caught the attention of investors. Analysts monitor insider data to understand the sentiment of a company’s largest and most important shareholders. BIOA’s insider trading patterns have some implications for where the stock might be headed.
Institutions own 28.70% of BioAmber Inc. (BIOA)’s shares. The total value of these holdings, in millions, is $3. Among active positions in the latest quarter, 13 holders increased their positions by a total of 3.24 million shares, 15 holders decreased the positions by a total of 8.72 million shares, and 7 holders held their positions. This works out to a net decrease in ownership of 5.48 million shares, and suggests that institutions are feeling bearish about the stock.
Among new and sold out positions, 3 holders initiated new positions by a total of 181222 shares and 10 holders exited their positions by a total of 8.41 million shares. This nets out to a decrease of 8.23 million shares and is another bearish sign for BIOA.
In the last three months, insiders executed a total of 1 trades. 1 of these were buys. Insider ownership increased by a total of 40000 shares, which suggests that BIOA’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 12 buys, and ownership increased by a net of 378331 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. BioAmber Inc. (NYSE:BIOA)’s short interest is 3.48 million shares, or % of the float. This represents a decrease of -1% 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.
In light of the insider ownership and trading data it makes sense to consider technicals to see if they come to a similar conclusion about the outlook for BIOA. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that BIOA is a Strong sell, which implies that BIOA is expected to underperform the market based on prior trading patterns.
Institutional ownership trends suggest that the stock is cheap and the insider trading data indicates that insiders are bullish. Technical indicators (also) suggest that BioAmber Inc. (NYSE:BIOA) is overvalued.