Usually, when one insider buys stock, it might not be a monumental event. But when multiple insiders are buying like they did in the case of FibroGen, Inc. (NASDAQ:FGEN), that sends out a positive message to the company's shareholders.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

See our latest analysis for FibroGen

The Last 12 Months Of Insider Transactions At FibroGen

The CEO & Director Thane Wettig made the biggest insider purchase in the last 12 months. That single transaction was for US$95k worth of shares at a price of US$1.91 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$0.48). While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. We always take careful note of the price insiders pay when purchasing shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

In the last twelve months FibroGen insiders were buying shares, but not selling. They paid about US$1.68 on average. I'd consider this a positive as it suggests insiders see value at around the current price. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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

Does FibroGen Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Based on our data, FibroGen insiders have about 1.1% of the stock, worth approximately US$514k. We prefer to see high levels of insider ownership.

What Might The Insider Transactions At FibroGen Tell Us?

The fact that there have been no FibroGen insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. We'd like to see bigger individual holdings. However, we don't see anything to make us think FibroGen insiders are doubting the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing FibroGen. Be aware that FibroGen is showing 5 warning signs in our investment analysis, and 2 of those are concerning...

But note: FibroGen may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

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 of direct interests only, but not derivative transactions or indirect interests.

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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.