We wouldn't blame Intuitive Machines, Inc. (NASDAQ:LUNR) shareholders if they were a little worried about the fact that Kamal Ghaffarian, the Co-Founder & Chairman recently netted about US$19m selling shares at an average price of US$4.00. That diminished their holding by a very significant 57%, which arguably implies a strong desire to reallocate capital.
Intuitive Machines Insider Transactions Over The Last Year
Notably, that recent sale by Kamal Ghaffarian is the biggest insider sale of Intuitive Machines shares that we've seen in the last year. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of US$4.03. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. We note that the biggest single sale was 57% of Kamal Ghaffarian's holding.
In the last year Intuitive Machines insiders didn't buy any company stock. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
I will like Intuitive Machines better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.
Insider Ownership Of Intuitive Machines
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. Intuitive Machines insiders own about US$27m worth of shares. That equates to 5.3% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
What Might The Insider Transactions At Intuitive Machines Tell Us?
An insider sold Intuitive Machines shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. While insiders do own shares, they don't own a heap, and they have been selling. We'd practice some caution before buying! 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 example, Intuitive Machines has 5 warning signs (and 2 which don't sit too well with us) we think you should know about.
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 of direct interests only, but not derivative transactions or indirect interests.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com