Shareholders in Novavax (NASDAQ:NVAX) and NVAX stock are seeing a lot of red today. In fact, shares of NVAX are currently trading down nearly 13% at the time of writing, continuing the highly volatile trend this biotech stock has been on of late.
As a company which is in Phase 3 trials for its Covid-19 vaccine candidate, investors may be wondering if the window of opportunity is slowly closing for Novavax.
Indeed, other Covid-19 vaccine plays have lost momentum in a similar way of late. However, looking at the stock chart of NVAX stock, it’s been anything but a smooth ride for shareholders of late.
It appears analysts remain mixed on this stock. The company’s current average price target around $210 per share implies a little more than 10% upside for this play. However, it appears a range of uncertainties are providing investors with pause today.
As it happens, there’s also one specific catalyst driving NVAX shares lower today. Let’s dive into what this catalyst is, and why investors are turning bearish on this biotech stock right now.
NVAX Stock Down on Insider Sale
Yesterday, a Form 4 was filed by Novavax’s CEO Stanley Erck. In this filing, it was disclosed that the CEO had disposed of 52,559 shares at an average price of $215.89. The total proceeds from this transaction totaled more than $11 million.
Now, insider selling can take place for a variety of reasons. Various executives often sell stock to diversify their holdings. Others have capital needs or sell stock for tax purposes. Such sales are considered normal. However, any large stock sale such as this one is likely to grab investor attention.
Mr. Erck still holds more than 35,000 shares of NVAX stock, so this sale was substantial, but didn’t represent a dumping of his entire stake. That said, these sales took place on the same day as stock was acquired via what appears to be stock-based compensation, a move that generally implies insiders are looking to cash out.
As a general rule, investors tend to like management teams with more skin in the game than less. This move appears to have rocked investor’s confidence in NVAX stock today, hence today’s selloff.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
