What to think of insiders selling?

I've been looking into INMD for a while and have started to build a position over the last 2 weeks. Their earnings report came out 2 days ago and their insider selling across the board was brutal. Insiders stake has been reduced from 25% – 7% over the year. Obviously no one likes seeing this but I'll try to share some thinking on why this is potentially not being enough of a problem to cause me to sell.

  1. I read “One up on Wall Street” and Peter Lynch talks about how insider buying is always good but insider selling can mean many different things.
  2. The stock did run 300% to January-October so it was smart to take gains throughout the year. The stock has fallen 55% from its all time high so they could potentially buy back shares they sold last year. They also guided conservatively leading me to believe that they wanted the stock lower, potentially to re-buy shares.

Let me know if you think I'm grasping at air here or if you believe there's so validity to my points.


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