Recent insider trends for Lipocine Inc. (NASDAQ:LPCN) have caught the attention of investors. Analysts monitor insider data to understand the sentiment of a company’s largest and most important shareholders. LPCN’s insider trading patterns have some implications for where the stock might be headed.
Institutions own 22.12% of Lipocine Inc. (LPCN)’s shares. The total value of these holdings, in millions, is $6. Among active positions in the latest quarter, 20 holders increased their positions by a total of 970598 shares, 19 holders decreased the positions by a total of 1.67 million shares, and 12 holders held their positions. This works out to a net decrease in ownership of 701438 shares, and suggests that institutions are feeling bearish about the stock.
Among new and sold out positions, 8 holders initiated new positions by a total of 399889 shares and 10 holders exited their positions by a total of 1.07 million shares. This nets out to a decrease of 668209 shares and is another bearish sign for LPCN.
In the last three months, insiders executed a total of 6 trades. 6 were sells. Insider ownership decreased by a total of 15626 shares, which suggests that LPCN’s key executives are feeling less optimistic about the outlook for the stock. The data from the past twelve months tells a different story: insiders executed 1 buys and 6 sells, and ownership increased by a net of 1574 shares.
The analysis of insider buying and selling trends can be extended to the aggregate level. Short interest, which represents the number of a stock’s shares currently being shorted, captures what the market as a whole feels about a stock. Lipocine Inc. (NASDAQ:LPCN)’s short interest is 1.39 million shares, or 6.99% of the float. This represents an increase of 4% in the number of shares being shorted compared to the previous reading, and implies that investors felt more pessimistic about the stock during the past two weeks.
In light of the insider ownership and trading data it makes sense to consider technicals to see if they come to a similar conclusion about the outlook for LPCN. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that LPCN is a Strong sell, which implies that LPCN is expected to underperform the market based on prior trading patterns.
Institutional ownership trends suggest that the stock is cheap and the insider trading data indicates that insiders are bearish. Technical indicators (also) suggest that Lipocine Inc. (NASDAQ:LPCN) is overvalued.