Orchestra BioMed Holdings, Inc. (NASDAQ:OBIO) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 16%, resulting in a US$40m rise in the company's market capitalisation, translating to a gain of 36% on their initial investment. As a result, their original purchase of US$321.7k worth of stock is now worth US$438.9k.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

Orchestra BioMed Holdings Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by Independent Lead Director Eric Fain for US$83k worth of shares, at about US$4.13 per share. Even though the purchase was made at a significantly lower price than the recent price (US$4.75), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Orchestra BioMed Holdings insiders may have bought shares in the last year, but they didn't sell any. The average buy price was around US$3.48. To my mind it is good that insiders have invested their own money 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. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Orchestra BioMed Holdings is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Orchestra BioMed Holdings Insiders Bought Stock Recently

It's good to see that Orchestra BioMed Holdings insiders have made notable investments in the company's shares. Overall, three insiders shelled out US$158k for shares in the company -- and none sold. This makes one think the business has some good points.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. It appears that Orchestra BioMed Holdings insiders own 4.0% of the company, worth about US$10m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Orchestra BioMed Holdings Insiders?

It is good to see recent purchasing. We also take confidence from the longer term picture of insider transactions. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. When combined with notable insider ownership, these factors suggest Orchestra BioMed Holdings insiders are well aligned, and that they may think the share price is too low. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Orchestra BioMed Holdings.

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.