Don't Ignore The Fact That This Insider Just Sold Some Shares In Lemonade, Inc. (NYSE:LMND)

By
Simply Wall St
Published
September 15, 2021
NYSE:LMND
Source: Shutterstock

We wouldn't blame Lemonade, Inc. (NYSE:LMND) shareholders if they were a little worried about the fact that Michael Eisenberg, the Lead Independent Director recently netted about US$768k selling shares at an average price of US$76.82. However, that sale only accounted for 7.8% of their holding, so arguably it doesn't say much about their conviction.

Check out our latest analysis for Lemonade

The Last 12 Months Of Insider Transactions At Lemonade

In the last twelve months, the biggest single sale by an insider was when the Co-Founder, Daniel Schreiber, sold US$48m worth of shares at a price of US$159 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The silver lining is that this sell-down took place above the latest price (US$70.91). So it is hard to draw any strong conclusion from it.

In the last year Lemonade insiders didn't buy any company stock. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

insider-trading-volume
NYSE:LMND Insider Trading Volume September 15th 2021

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Insider Ownership of Lemonade

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. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that Lemonade insiders own 6.7% of the company, worth about US$295m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Lemonade Insiders?

An insider hasn't bought Lemonade stock in the last three months, but there was some selling. Looking to the last twelve months, our data doesn't show any insider buying. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. When we did our research, we found 5 warning signs for Lemonade (1 can't be ignored!) that we believe deserve your full attention.

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.

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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.
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