Insider Buying

Insider Buying Report: Silence Therapeutics PLC (SLN:LN)

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Silence Therapeutics PLC (SLN:LN)

12-month performance: +52%
Insider activity: Bullish
Insider buying pattern: Purchase by the Chairman and a number of directors
Recent news: Half-year results

Insider buying can provide valuable clues about a stock’s potential. Insiders may sell their stock for a variety of reasons. But they only buy stock for one reason - they expect it to go up.

Here, we are going to highlight a cluster of purchases at Silent Therapeutics PLC (SLN:LN). Silent Therapeutics is a biotechnology company that focuses on the discovery, development, and delivery of novel RNA therapeutics. It’s listed on the London Stock Exchange’s AIM market and currently has a market capitalization of £323 million.

Silent Therapeutics: insider buying

Regulatory filings show that between the 8th and 14th of October, the Chairman and four directors purchased Silent Therapeutics stock at a price of between £3.97 and £4.10 a share. All five insiders increased their holdings by more than 10%.

SLN-LN (chart)     Source: 2iQ Research

Cluster Buying

The high number of insider share purchases at Silent Therapeutics is extremely significant. It provides a signal that there is a strong belief amongst many high-level insiders that the stock is undervalued.

It’s worth pointing out that Non-Executive Director, David Lemus, has a very high insider IQ of 138. This tells us his previous purchases have been timed very well.

Upping of R&D spend

Silent Therapeutics shares are currently down around 20% since late August having performed strongly over the last year. The company is hiring a new CFO after the current CFO announced his intention to leave. Despite a half-year loss, the doubling of research and development spend highlights the strong pipeline. A strategic collaboration with AstraZeneca will ensure future products that result from the R&D will be strongly monetized.

All things considered, we see the insider buying at Silent Therapeutics as bullish. It suggests that the Chairman and his fellow insiders view the stock as undervalued. The insiders look to be taking advantage of the recent fall in the share price.