Cara Therapeutics, Inc.'s (NASDAQ:CARA) Chief Medical Officer, Joana Goncalves, has sold a total of 2,753 shares of company stock, according to a recent filing with the Securities and Exchange Commission. The transaction, which took place on April 5th, was part of a pre-arranged "sell to cover" plan to satisfy tax withholding obligations related to the vesting of restricted stock units.
The shares were sold at a price of $0.83 each, amounting to a total value of $2,284. This sale was not a discretionary trade by Goncalves but was executed in accordance with a Rule 10b5-1 trading plan adopted on March 12, 2020. Following the sale, Goncalves continues to hold 53,365 shares of Cara Therapeutics' common stock.
Rule 10b5-1 plans allow company insiders to set up predetermined trading arrangements for selling stocks at a future date, providing a defense against potential accusations of insider trading. The company, headquartered in Stamford, Connecticut, specializes in the development of pharmaceutical preparations.
Investors often monitor the buying and selling activities of company insiders as they may provide insights into the insider's view of the company's future prospects. However, sales made under a 10b5-1 trading plan are generally considered to be less indicative of an insider's discretionary economic decision-making.
Cara Therapeutics has not provided any additional comments on the transaction. The company's shares are publicly traded on the NASDAQ exchange under the ticker symbol CARA.
InvestingPro Insights
As Cara Therapeutics (NASDAQ:CARA) navigates through a challenging period, recent activity by the company's Chief Medical Officer has drawn attention. The sale of shares, while part of a pre-arranged plan, coincides with a notable downturn in the company's stock performance. According to InvestingPro real-time data, Cara Therapeutics has a market capitalization of just $45.36 million and a significantly negative P/E ratio of -0.37, reflecting the difficulties the company faces in achieving profitability.
The stock's recent trajectory is further illustrated by a 1-week price total return of -10.22% and a 1-month price total return of -15.89%. However, it's worth noting that over the last three months, the stock has seen a strong return of 26.57%, suggesting some recovery or positive sentiment among investors.
From the perspective of InvestingPro Tips, two insights stand out. Firstly, Cara Therapeutics holds more cash than debt on its balance sheet, which can be a sign of financial stability. Secondly, analysts do not anticipate the company will be profitable this year, which aligns with the negative gross profit margin of -441.53% over the last twelve months as of Q4 2023. These metrics could be vital for investors trying to understand the company's financial health and future prospects.
For those looking to delve deeper into Cara Therapeutics' financials and stock performance, InvestingPro offers a comprehensive set of additional tips. Currently, there are 12 more InvestingPro Tips available, which could provide valuable insights, especially in the context of the company's recent sales decline and weak gross profit margins. Investors interested in these detailed analytics can use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
With the next earnings date approaching on May 6, 2024, and a fair value estimation by analysts at $5 USD, compared to the InvestingPro fair value of $0.96 USD, investors will be keenly watching for signs of turnaround or further decline in Cara Therapeutics' performance.
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