Don't Ignore The Fact That This Insider Just Sold Some Shares In CarLotz, Inc. (NASDAQ:LOTZ)

By
Simply Wall St
Published
May 15, 2022
NasdaqGM:LOTZ
Source: Shutterstock

We'd be surprised if CarLotz, Inc. (NASDAQ:LOTZ) shareholders haven't noticed that an insider, Michael Bor, recently sold US$213k worth of stock at US$0.73 per share. However, the silver lining is that the sale only reduced their total holding by 2.9%, so we're hesitant to read anything much into it, on its own.

Check out our latest analysis for CarLotz

CarLotz Insider Transactions Over The Last Year

Notably, that recent sale by Michael Bor is the biggest insider sale of CarLotz shares that we've seen in the last year. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is US$0.61. So it may not shed much light on insider confidence at current levels.

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!

insider-trading-volume
NasdaqGM:LOTZ Insider Trading Volume May 15th 2022

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Does CarLotz 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. We usually like to see fairly high levels of insider ownership. It appears that CarLotz insiders own 15% of the company, worth about US$11m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The CarLotz Insider Transactions Indicate?

An insider hasn't bought CarLotz stock in the last three months, but there was some selling. And even if we look at the last year, we didn't see any purchases. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We're in no rush to buy! 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 5 warning signs for CarLotz you should know about.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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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