Viewing insider transactions for Fate Therapeutics, Inc.'s (NASDAQ:FATE ) over the last year, we see that insiders were net buyers. This means that a larger number of shares were purchased by insiders in relation to shares sold.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

View our latest analysis for Fate Therapeutics

The Last 12 Months Of Insider Transactions At Fate Therapeutics

Over the last year, we can see that the biggest insider purchase was by Independent Vice Chairman of the Board John Mendlein for US$698k worth of shares, at about US$5.67 per share. That means that an insider was happy to buy shares at above the current price of US$4.46. It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when an insider has purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. The only individual insider to buy over the last year was John Mendlein.

You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.

Fate Therapeutics Insiders Are Selling The Stock

The last three months saw some Fate Therapeutics insider selling. Chief Commercial Officer Brian Powl divested only US$19k worth of shares in that time. It's not great to see insider selling, nor the lack of recent buyers. But the volume sold is so low that it really doesn't bother us.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Our data indicates that Fate Therapeutics insiders own about US$7.1m worth of shares (which is 1.6% of the company). Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!

What Might The Insider Transactions At Fate Therapeutics Tell Us?

We did not see any insider buying in the last three months, but we did see selling. But the sales were small, so we're not concerned. However, our analysis of transactions over the last year is heartening. We'd like to see bigger individual holdings. However, we don't see anything to make us think Fate Therapeutics insiders are doubting the company. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. At Simply Wall St, we've found that Fate Therapeutics has 2 warning signs (1 doesn't sit too well with us!) that deserve your attention before going any further with your analysis.

Of course Fate Therapeutics may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions, but not derivative transactions.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Join A Paid User Research Session
You’ll receive a US$30 Amazon Gift card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here