Key Points
One person that helped bring the chill was an analyst cutting his price target.
Another two were executives at the biotech selling chunks of stock.
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According to data compiled by S&P Global Market Intelligence, Recursion Pharmaceuticals (NASDAQ: RXRX) stock was shedding more than 17% of its value week-to-date as of Thursday night.
The company was the target of an analyst price target cut. On top of that, regulatory filings revealed that several of the clinical-stage biotech’s executives had sold large piles of stock.
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1 price target cut, 2 insiders selling
The analyst wielding the scissors was Sean Laaman from white-shoe investment bank Morgan Stanley (NYSE: MS). On Tuesday, he shaved $0.20 per share from his fair value assessment to a new level of $4.80, and maintained his equalweight (hold, in other words) recommendation on the stock. Detailed information on Laaman’s latest Recursion take weren’t immediately available.
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They weren’t all that necessary for investors to make a decision, as those folks had other share-price-slamming news to digest those days. Documents filed by several top managers with the Securities and Exchange Commission (SEC) disclosed five-digit-strong share sales.
CEO Christopher Gibson was one of those sellers, with a Thursday reveal that he had sold 40,390 shares of Recursion’s common stock. Chief R&D and commercial officer Najit Khan was also a seller; she unloaded almost the same number of shares (40,388 in total).
In both disclosures, a footnote stated that nearly all of the stock divested by the pair was “required to be sold by the issuer to satisfy the tax withholding and remittance obligations in connection with the vesting of restricted stock units.”
Overreaction time?
Biotech stocks are volatile by their nature, so even mildly concerning developments like limited share sales or slight price target cuts can rock a company. Given that, I don’t believe anyone should base their Recursion investment decision on them alone.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
