Some CareDx, Inc. (NASDAQ:CDNA) shareholders may be a little concerned to see that the Independent Chairman, Michael Goldberg, recently sold a substantial US$2.1m worth of stock at a price of US$47.06 per share. That sale reduced their total holding by 24% which is hardly insignificant, but far from the worst we've seen.

The Last 12 Months Of Insider Transactions At CareDx

Notably, that recent sale by Michael Goldberg is the biggest insider sale of CareDx shares that we've seen in the last year. That means that an insider was selling shares at around the current price of US$46.69. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.

Insiders in CareDx didn't buy any shares in the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.

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. It's great to see that CareDx insiders own 4.6% of the company, worth about US$108m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Does This Data Suggest About CareDx Insiders?

Insiders sold CareDx shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. But since CareDx is profitable and growing, we're not too worried by this. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing CareDx. Be aware that CareDx is showing 4 warning signs in our investment analysis, and 2 of those don't sit too well with us...

Of course CareDx may not be the best stock to buy. So you may wish to see this free collection of high quality 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.