Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Insider Buying at Regulus Therapeutics Inc (RGLS) Sends Stock Soaring

What:

Regulus Therapeutics Inc (NASDAQ:RGLSshares have jumped $0.30 per share, or 24%, to $1.55 in after hours on Thursday. Traders have bid up shares due to the company disclosing in a regulatory filing that Regulus chairman, Stelios Papadopoulos, bought a stake of 500,000 shares in two separate tranches. In terms of amount paid, Papadopoulos bought the first batch of 200,000 shares at $1.199 each, and the chairman bought his second batch of 300,000 shares at $1.227 each.

Insider Buying Normally Bullish

Although Papadopoulos bought Regulus Therapeutics Inc (NASDAQ:RGLS) for substantially less than what the stock is trading for now in after-hours, sentiment (in the short term) has improved for the stock as insider buying by a Chairman of the Board is normally bullish. Given that he is a member of the board, Papadopoulos knows Regulus Therapeutics Inc (NASDAQ:RGLS) and its prospects a lot better than the average trader. With that said, there is also the probability that Papadopoulos bought just to show faith in the company and its prospects, such as for the company’s drug candidate RGLS4326 for the potential treatment of ADPKD.

What does Smart Money Sentiment Say?

Of the 742 elite funds we track, 5 funds owned $1.87 million of Regulus Therapeutics Inc (NASDAQ:RGLS) and accounted for 1.60% of the float on December 31, versus 9 funds and $8.33 million respectively on September 30. Specifically, Israel Englander’s Millennium Management initiated a new stake of 376,234 shares worth 847,000 at the end of December.Going the opposite way was Jim Simons’ Renaissance Technologies, which cut its holdings by 51% to 321,200 shares of Regulus Therapeutics Inc (NASDAQ:RGLS).

At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 39.7% gains over the past 12 months and outperformed the 24.1% gain enjoyed by the S&P 500 ETFs. Our enhanced small-cap hedge fund strategy returned more than 45% over the last 12 months and outperformed SPY by more than 30 percentage points over the last 4.5 years (see details here).

What Next:

We would stay on the sidelines for now. Although the insider buying by Papadopoulos has definitely improved sentiment in the short term, Regulus Therapeutics Inc (NASDAQ:RGLS) is still losing money. For its fourth quarter, the company lost $0.38 per share, versus estimates of $0.37 per share. Revenue, meanwhile, came in just under $0.1 million. There is also still a continued hold for the company’s important RG-101, which is a potential candidate for hepatitis C. Analyst commentary has been cautious.  In January, analyst Alan Carr of Needham downgraded the stock to ‘Hold’ in part due to his belief that competition from effective once daily oral options for HCV could blunt Regulus Therapeutics Inc (NASDAQ:RGLS)’s opportunity. With that said, Regulus Therapeutics Inc (NASDAQ:RGLS) is a small-cap stock and small-cap stocks can be extremely volatile, especially when the stock has been trending down for so long.

Disclosure:None

Follow Regulus Therapeutics Inc. (NASDAQ:RGLS)
Trade (NASDAQ:RGLS) Now!
Wall Street Bull

Wall Street Bull