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When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in Local Bounti Corporation's (NYSE:LOCL) instance, it's good news for shareholders.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
Check out our latest analysis for Local Bounti
Local Bounti Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Co-Founder Craig Hurlbert for US$143k worth of shares, at about US$1.35 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$2.76. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.
Over the last year, we can see that insiders have bought 237.69k shares worth US$346k. On the other hand they divested 4.25k shares, for US$16k. In total, Local Bounti insiders bought more than they sold over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Local Bounti is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.
Does Local Bounti Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Local Bounti insiders own 54% of the company, currently worth about US$13m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Do The Local Bounti Insider Transactions Indicate?
The fact that there have been no Local Bounti insider transactions recently certainly doesn't bother us. However, our analysis of transactions over the last year is heartening. Judging from their transactions, and high insider ownership, Local Bounti insiders feel good about the company's future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For instance, we've identified 6 warning signs for Local Bounti (1 is significant) you should be aware of.