Biomea Fusion, Inc. (NASDAQ:BMEA) insiders who purchased shares in the last 12 months were richly rewarded last week. The stock climbed by 12% resulting in a US$10m addition to the company’s market value. As a result, their original purchase of US$196.7k worth of stock is now worth US$237.6k.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Biomea Fusion Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by Interim CEO & Director Michael J. Hitchcock for US$99k worth of shares, at about US$0.99 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$1.32. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.

In the last twelve months Biomea Fusion insiders were buying shares, but not selling. They paid about US$1.09 on average. We don't deny that it is nice to see insiders buying stock in the company. However, you should keep in mind that they bought when the share price was meaningfully below today's levels. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

Biomea Fusion is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. From our data, it seems that Biomea Fusion insiders own 6.7% of the company, worth about US$6.0m. Whilst better than nothing, we're not overly impressed by these holdings.

So What Does This Data Suggest About Biomea Fusion Insiders?

The fact that there have been no Biomea Fusion insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. While we have no worries about the insider transactions, we'd be more comfortable if they owned more Biomea Fusion stock. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. At Simply Wall St, we've found that Biomea Fusion has 7 warning signs (3 are concerning!) that deserve your attention before going any further with your analysis.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions of direct interests only, but not derivative transactions or indirect interests.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.