Stock Analysis

ContextLogic Inc (NASDAQ:WISH) Insiders Keep Selling their Stock

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NasdaqGS:WISH
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ContextLogic Inc (NASDAQ:WISH) has been on a downwards spiral after the IPO. The stock has lost some 64% in the last 6 months, and many investors are left wondering if the company has a viable business for the future. Today, we are going to evaluate what insiders have been doing in the months since the IPO, and get a proxy measure as to how they see the company's future.

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.

View our latest analysis for ContextLogic

ContextLogic Insider Transactions Over The Last Year

The Chief Accounting Officer & Interim Co-Chief Financial Officer, Brett Just, made the biggest insider sale in the last 12 months. That single transaction was for US$196k worth of shares at a price of US$19.63 each.

Over the last three months, we've seen significant insider selling at ContextLogic. In total, insiders sold US$447k worth of shares in that time, and we didn't record any purchases whatsoever.

The biggest sale in the last three months was recorded on September 14 & 15 when, GGV Capital, LLC sold US$6.63m worth of stock.

The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
NasdaqGS:WISH Insider Trading Volume October 8th 2021

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).

Insider Ownership

Many investors like to check how much of a company is owned by insiders. It is usually a good sign if insiders own a significant number of shares in the company. ContextLogic insiders own 10% of the company, currently worth about US$334m based on the recent share price.

10% is actually a decent stake, and it shows that part of the management is still hopeful on the company.

So What Do The ContextLogic Insider Transactions Indicate?

Unfortunately the continuous sale of stock by insiders, along with the absence of purchasing even at a price point which is 64% lower than six months ago, doesn't bode well for investor confidence.

It is good to see that management has retained a good portion of the company, but that is small redemption in light of all the circumstances.

All an all, it seems that investors are waiting on the stock to find a bottom and some clear signals that management sees their company running a viable operation in the future. 

Insiders sold stock recently, but they haven't been buying. 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. For example - ContextLogic has 3 warning signs we think you should be aware of.

Of course ContextLogic may not be the best stock to buy. So you may wish to see this free collection of high quality 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.

Valuation is complex, but we're helping make it simple.

Find out whether ContextLogic is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.

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Simply Wall St analyst Goran Damchevski and Simply Wall St have no position in any of the companies mentioned. This article 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.

Goran Damchevski

Goran Damchevski

Goran is an Equity Analyst and Writer at Simply Wall St over 4 years of experience in financial analysis and company research. Personally, Goran has over 4 years of experience in financial analysis and company research, where he previously worked in a seed-stage startup as a capital markets research analyst and product lead and developed a financial data platform for equity investors. 

About NasdaqGS:WISH

ContextLogic

ContextLogic Inc. operates as a mobile ecommerce company in Europe, North America, South America, and internationally.

Excellent balance sheet and good value.