At InsiderMonkey, we track insider purchases every day. It is very important to our investment strategy, just like keeping an eye on hedge fund activity. Therefore, in this article, I will look into two companies in the healthcare segment that have seen insiders buy their stock over the past couple of days.
First off is Intrexon Corp (NYSE:XON)¸a $2.5 billion market cap synthetic biology company that designs, builds and regulates gene programs using its proprietary -and complementary- technologies. Over the past month, the company witnessed three significant insider purchases.
Most recently, Randal Kirk, CEO, started a position in the stock with 243,001 shares. He paid $25.72 per share and now owns more than $6.2 million in Intrexon’s stock. In addition, Ian Gregory Frost, Senior Vice President at the company’s Health Sector, acquired 100,000 shares between Feb. 28th and March 4th. Having paid prices ranging from $24.59 per share to $26.04 per share, he now holds more than $2.5 million in stock.
When looking at Intrexon Corp (NYSE:XON)’s fundamentals only it’s easy to see that the company boasts negative margins and returns, while its stock looks somewhat overvalued. However, its growth prospects and upside potential make of this company a much more interesting investment option. In fact, it is not only insiders that are betting on this stock. Major hedge funds including Dan Loeb’s Third Point and David Einhorn’s Greenlight Capital do not only hold millionaire stakes in the company, but also, have increased their positions over the last reported quarter.
The second case I would like to refer to is that of Versartis Inc (NASDAQ:VSAR), a $697 million market cap development stage biopharmaceutical company that went public on a couple of weeks ago. It is currently developing therapeutic proteins for the treatment of metabolic diseases and endocrine disorders. Trying to make the most from it, six insiders (four board directors and two large shareholders) bought the stock over the first week. They purchased, in total, 360,000 shares of the company (60,000 each) for $21.00 per share (except for New Leaf Ventures Ii, L.P., which paid $21.02 per share on March 27th, after the IPO closed).
Once again, there investments are all about growth prospects and upside potential. In fact, since the aforementioned insider purchases, the stock has gained more than 40%. Although we do not have record of any major hedge funds holding this stock -for now, Versartis Inc (NASDAQ:VSAR) is certainly worth watching.
A little bonus: keep an eye on Nanosphere, Inc. (NASDAQ:NSPH), a micro-cap company that develops, manufactures and markets an advanced molecular diagnostics platform that enables sensitive genomic and protein testing on a single platform. Over the past week, three insiders purchased its stock. Furthermore, at least 9 major hedge funds hold stakes in the company.
Disclosure: Javier Hasse holds no position in any stocks mentioned