Edward H. Myles, the COO & CFO of Scholar Rock Holding Corp (NASDAQ:SRRK), has sold a significant portion of his holdings in the company, according to a recent SEC filing. The executive sold a total of 172,240 shares of common stock, resulting in proceeds exceeding $5.4 million.
The transactions occurred on October 7, 2024, and were executed at varying prices. The first sale of 111,972 shares was at a weighted average price of $25.61, with individual sales ranging from $25.15 to $26.14. The subsequent sales of 37,206 and 25,812 shares were at weighted average prices of $26.83 and $27.27, respectively, with price ranges of $26.15 to $27.14 and $27.15 to $27.48. The final sale of 31,250 shares was at a weighted average price of $29.05, with the prices ranging from $29.00 to $29.18.
These sales were conducted under a Rule 10b5-1 trading plan, which Myles had adopted earlier in the year. This plan allows corporate insiders to set up a predetermined schedule for buying or selling shares at a time when they are not in possession of material non-public information, to avoid accusations of insider trading.
In addition to the sales, Myles also exercised options to acquire 206,240 shares of Scholar Rock's common stock at a price of $13.83 per share. This transaction was separate from the sales and amounted to a total of $2,852,299.
Following these transactions, Myles' ownership in Scholar Rock has been adjusted, but the exact amount of his remaining stake was not disclosed in the filing. The company, which specializes in the development of biological products, has not issued any statement regarding these transactions.
Investors often monitor insider buying and selling as it can provide insights into an executive's confidence in the company's future performance. In this case, the substantial sale by Scholar Rock's COO & CFO might be of particular interest to current and potential shareholders.
In other recent news, Scholar Rock has announced a public offering aimed at raising $275 million, with the intention to fund various avenues including the commercialization of apitegromab. The underwriting syndicate is led by J.P. Morgan Securities LLC, Jefferies LLC, and Piper Sandler & Co. Furthermore, Scholar Rock has reported positive results from its Phase 3 SAPPHIRE clinical trial, showing significant improvement in motor function in patients treated with apitegromab. Analysts from TD (TSX:TD) Cowen and Truist Securities maintained a Buy rating on Scholar Rock, citing the strong trial results as a foundation for regulatory approval. In addition, Scholar Rock has appointed Beth Shafer, Ph.D., as Chief Business Officer, responsible for the company's long-term corporate and business development strategy. The company has also made progress with its apitegromab EMBRAZE study in obesity, with initial data expected in the second quarter of 2025. These are recent developments in Scholar Rock's ongoing efforts to bring new treatments to market.
InvestingPro Insights
Scholar Rock Holding Corp (NASDAQ:SRRK) has recently experienced a significant surge in its stock price, which provides context for the insider selling reported in the article. According to InvestingPro data, the company has seen an impressive 360.13% price return over the past week and a 365.13% return over the last year. This remarkable performance has pushed the stock to trade near its 52-week high, with the current price at 99.71% of that peak.
Two InvestingPro Tips are particularly relevant to this situation. First, analysts have revised their earnings upwards for the upcoming period, which could indicate positive expectations for the company's financial performance. Second, the stock's RSI suggests it is in overbought territory, which aligns with the recent price surge and might explain the timing of the insider's decision to sell.
It's worth noting that Scholar Rock holds more cash than debt on its balance sheet, and its liquid assets exceed short-term obligations. This financial stability could provide some reassurance to investors concerned about the insider selling. However, the company is not currently profitable, with a negative P/E ratio of -13.46 for the last twelve months as of Q2 2024.
For investors seeking a more comprehensive analysis, InvestingPro offers 17 additional tips for Scholar Rock, providing a deeper understanding of the company's financial health and market position.
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