Is MannKind
That's the question we ask when we evaluate insider buying and selling. We ask because how executives spend their paychecks is often a reflection of what they think of their companies' prospects.
Here's how MannKind founder Alfred Mann and his team have spent their money over the past year:
|
Insider Rating |
Moderately bullish
|
|
Business Description |
Developer of a unique inhaled insulin treatment that's yet to be approved by The Food and Drug Administration. |
|
Recent Price |
$6.87 |
|
CAPS Stars (Out of 5) |
** |
|
Percentage of Shares Owned by Insiders |
43.49% |
|
Net Buying (Selling)* |
$8.07 million |
|
Last Buyer (% Increase) |
Alfred Mann, Founder, Chairman, and CEO |
|
Last Seller (% Decrease) |
Diane Palumbo, VP, Human Resources |
|
Competitors |
Pfizer |
|
CAPS Members Bullish on MNKD Also Bullish on |
Johnson & Johnson |
|
CAPS Members Bearish on MNKD Also Bearish on |
Overstock.com |
|
Recent Foolish Coverage of MNKD |
5 Stocks in a Tailspin
|
Sources Form 4 Oracle, Capital IQ, and Motley Fool CAPS. (Data current as of Nov. 17.)
*Open market sales and purchases only.
What we're tracking here, and why
Insider buying data can be confusing. Here, I'm concentrating only on buying and selling conducted in the open market. With most of these transactions, insiders control the timing. Other times they're buying or selling under the purview of a 10b5-1 plan. Either way, personal holdings are being bought and sold.
Those personal holdings matter the most -- they're the shares executives hold for investment, rather than compensation. Employee stock options are different; they're compensatory in the purest sense. I've stripped out options-related buying and selling from the calculations you see above.
The Foolish view: Moderately bullish
MannKind is one of a kind among story stocks.
Founder Al Mann, now 83, is a highly successful entrepreneur that Forbes ranks 522nd on its list of the world's richest, with a $1.4 billion fortune. He'll move higher if MannKind pays off; Mann owns more than 40% of the business as of this writing.
Yet success is anything but assured. MannKind is the last company standing in what was once an emerging market for inhaled insulin products used to treat diabetes. What went wrong? In a word: Exubera. This onetime competitor to MannKind's Afresa was permanently tainted when a safety analysis showed a higher incidence of lung cancer in Exubera-treated patients.
Today, Afresa is still at least two months away from FDA approval, and MannKind is without a marketing partner. The good news: The company's third-quarter loss was smaller than analysts expected, thanks in part to careful expense management.
And insiders? How are they spending? Al Mann bet big in August, at $8.11 a share. I like that buy, but I'm also mindful that MannKind is an all-in bet for him. He'll be first in line to supply capital if the company needs it.
Meanwhile, the selling pattern here is ... confusing. Sure, VP of Human Resources Diane Palumbo sold a portion of her holdings at lower prices than MannKind trades for today. That's not necessarily a bearish indicator; she still owns more than 130,000 shares.
What's more, Chief Scientific Officer Peter Richardson in August sold only a sliver of what he holds, and at $7.79 apiece -- a 13% premium to yesterday's close. I'd expect more lowball selling if insiders genuinely feared that this stock story would end badly.
But that's also just my take. Do you agree? Disagree? Log into Motley Fool CAPS today and tell us how you would rate MannKind.
And if you want me to take a Foolish peek at the insider action of your favorite stock, email me here or use the comments box below. I'll write this column as often as you, our readers, demand.
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