With stock up 4.9%, Insiders of Eli Lilly and Company (NYSE:LLY) must be wishing they had bought more last year

Eli Lilly and Company (NYSE:LLY) insiders who purchased shares in the last 12 months were richly rewarded last week. The stock climbed by 4.9% resulting in a US$15b addition to the company’s market value. As a result, the stock they originally bought for US$249k is now worth US$301k.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Eli Lilly

Eli Lilly Insider Transactions Over The Last Year

The Independent Director Jackson Tai made the biggest insider purchase in the last 12 months. That single transaction was for US$200k worth of shares at a price of US$304 each. We do like to see buying, but this purchase was made at well below the current price of US$351. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Eli Lilly insiders may have bought shares in the last year, but they didn't sell any. 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!

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Eli Lilly Insiders Bought Stock Recently

Over the last three months, we've seen significant insider buying at Eli Lilly. We can see that Independent Director Jackson Tai paid US$200k for shares in the company. No-one sold. This makes one think the business has some good points.

Insider Ownership Of Eli Lilly

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Eli Lilly insiders own about US$521m worth of shares (which is 0.2% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Eli Lilly Insiders?

It is good to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about Eli Lilly. That's what I like to see! While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. In terms of investment risks, we've identified 3 warning signs with Eli Lilly and understanding them should be part of your investment process.

Of course Eli Lilly 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, but not derivative transactions.

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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.

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