Samsara BioCapital, a major owner of Graphite Bio (GRPH), recently added 50,800 shares. The buy came to a total cost of just over $667,000.
This follow up from a 145,496 share buy from the same fund a week before. These are the only transactions from insiders since the company went public in August 2020. Overall, company insiders own nearly 10 percent of shares, with major holders like Samsara owning a collective 80 percent of shares, leaving few for individual investors.
Shares of the gene editing company are down nearly 30 percent in the past year, as the company has been operating at a loss. However, the downtrend in shares has flattened out in recent weeks, and shares may be ready to start a move higher.
Action to take: Besides looking oversold on a technical basis, the company has over $6.50 in cash, or nearly half the share price right now, with no debt.
While a biotech company can be at the whims of regulatory concerns, the company has ample cash to work through its current pipeline of projects, with a good chance of one of them coming to fruition. This is one company where shares could outperform the overall market in the coming months.
As a smaller-cap company under $1 billion, there are no options for traders at this time.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.