Bullish NextNav Insiders Loaded Up On US$20.8m Of Stock

Simply Wall St · 10/18 11:20

Quite a few insiders have dramatically grown their holdings in NextNav Inc. (NASDAQ:NN) over the past 12 months. An insider's optimism about the company's prospects is a positive sign.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for NextNav

NextNav Insider Transactions Over The Last Year

The insider Charles Frischer made the biggest insider purchase in the last 12 months. That single transaction was for US$9.6m worth of shares at a price of US$5.17 each. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$8.25. 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 3.93m shares worth US$21m. But insiders sold 325.65k shares worth US$1.7m. In total, NextNav insiders bought more than they sold over the last year. 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
NasdaqCM:NN Insider Trading Volume October 18th 2024

NextNav is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Insiders At NextNav Have Bought Stock Recently

At NextNav,over the last quarter, we have observed quite a lot more insider buying than insider selling. Independent Director Neil Subin spent US$1.7m on stock. On the other hand, insiders netted US$29k by selling. We think insiders may be optimistic about the future, since insiders have been net buyers of shares.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. NextNav insiders own 24% of the company, currently worth about US$245m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Do The NextNav Insider Transactions Indicate?

The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. When combined with notable insider ownership, these factors suggest NextNav insiders are well aligned, and quite possibly think the share price is too low. One for the watchlist, at least! While it's good to be aware of 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. To assist with this, we've discovered 3 warning signs that you should run your eye over to get a better picture of NextNav.

Of course NextNav 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 of direct interests only, but not derivative transactions or indirect interests.