Yahoo Finance Insiders Re-Evaluate Their US$21.5m Stock Purchase As Luminar Technologies Falls To US$743m
The recent price decline of 28% in Luminar Technologies, Inc.'s (NASDAQ:LAZR) stock may have disappointed insiders who bought US$21.5m worth of shares at an average price of US$5.98 in the past 12 months. This is not good as insiders invest based on expectations that their money will appreciate over time. However, as a result of recent losses, their original investment is now worth only US$5.18m.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
See our latest analysis for Luminar Technologies
The Last 12 Months Of Insider Transactions At Luminar Technologies
The Founder Austin Russell made the biggest insider purchase in the last 12 months. That single transaction was for US$8.9m worth of shares at a price of US$6.26 each. That means that an insider was happy to buy shares at above the current price of US$1.44. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
Over the last year, we can see that insiders have bought 3.60m shares worth US$22m. On the other hand they divested 114.45k shares, for US$726k. In the last twelve months there was more buying than selling by Luminar Technologies insiders. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
Luminar Technologies is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Does Luminar Technologies Boast High Insider Ownership?
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Luminar Technologies insiders own 26% of the company, currently worth about US$194m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Do The Luminar Technologies Insider Transactions Indicate?
There haven't been any insider transactions in the last three months -- that doesn't mean much. But insiders have shown more of an appetite for the stock, over the last year. It would be great to see more insider buying, but overall it seems like Luminar Technologies insiders are reasonably well aligned (owning significant chunk of the company's shares) and optimistic for the future. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Every company has risks, and we've spotted 4 warning signs for Luminar Technologies you should know about.
But note: Luminar Technologies may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions of direct interests only, but not derivative transactions or indirect interests.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
