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Insiders may be rethinking their US$4.7m Lightspeed Commerce Inc. (TSE:LSPD) investment now that the company has lost CA$647m in value

The recent price decline of 12% in Lightspeed Commerce Inc.'s (TSE:LSPD) stock may have disappointed insiders who bought US$4.7m worth of shares at an average price of US$98.79 in the past 12 months. Insiders purchase with the hope of seeing their investments increase in value over time. However, due to recent losses, their initial investment is now only worth US$1.5m, which is not great.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for Lightspeed Commerce

The Last 12 Months Of Insider Transactions At Lightspeed Commerce

In the last twelve months, the biggest single purchase by an insider was when Founder & Executive Chairman of the Board Dax Dasilva bought CA$2.3m worth of shares at a price of CA$90.20 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being CA$31.22). It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

Happily, we note that in the last year insiders paid CA$4.7m for 47.22k shares. On the other hand they divested 9.06k shares, for CA$1.1m. In the last twelve months there was more buying than selling by Lightspeed Commerce insiders. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
insider-trading-volume

Lightspeed Commerce is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. Lightspeed Commerce insiders own about CA$449m worth of shares (which is 9.7% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

What Might The Insider Transactions At Lightspeed Commerce Tell Us?

The fact that there have been no Lightspeed Commerce insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. With high insider ownership and encouraging transactions, it seems like Lightspeed Commerce insiders think the business has merit. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. You'd be interested to know, that we found 2 warning signs for Lightspeed Commerce and we suggest you have a look.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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, but not derivative transactions.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

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