Insider Buying

Insider Buying Report: Vita Coco Company Inc (COCO:US)

Vita Coco Company Inc's various products are displayed on a sky blue floor.
Vita Coco Company Inc
(COCO:US)
12 months:
-31.36%
Activity:
Bullish
Pattern:
Purchase from Co-CEO and a Director
News:
Full-year results
Vita Coco Company Inc
(COCO:US)
12 months:
-31.36%
Activity:
Bullish
Pattern:
Purchase from Co-CEO and a Director
News:
Full-year results

Insider transactions can give investors a more complete view of activity within the world’s publicly-listed companies. No one has more information in relation to a company’s prospects than its leaders.

Here, we are going to highlight some interesting insider transactions at Vita Coco Company Inc (COCO:US). Vita Coco is a beverage company that makes a variety of coconut water products that are sold by retailers in the US. It also sells to consumers globally via its website. The company is listed on the Nasdaq Stock Exchange and currently has a market capitalization of $515 million.

Vita Coco Company Inc: Insider Buying

Our insider transaction data shows that between March 14 and March 18, two insiders at Vita Coco bought stock. Those who bought shares were:

  • Co-CEO Martin Roper (100,000 shares @ $885 per share)
  • Director Kenneth Sadowsky (10,000 shares @ $7.87 per share)

In total, the two insiders spent a little over $950,000 on Vita Coco stock.

The chart represents Vita Coco Company Inc' price history, with significant buy and sell events highlighted.

Industry Experts

We believe these insider trades are worth highlighting for two reasons.

Firstly, both Mr. Roper and Mr. Sadowsky are veterans of the beverage industry. Mr. Roper held senior positions at the Boston Beer Company for over twenty years and was CEO up until 2018 before he joined the Vita Coco Company in 2019.

Meanwhile, Mr. Sadowsky has worked within the beverage sector for close to 40 years. Previously, he advised Bai Brands and Dyla Brands amongst others, and he was also a Director of Energy Brands Inc from 2000 to 2006.

Given their experience, both insiders are likely to be very capable of assessing the prospects of the business.

Secondly, the Co-CEO has spent close to $900,000 on company stock, which is a sizable amount of money. This suggests that he is very optimistic that the shares represent good value at these levels.

Impressive Net Sales Growth

Vita Coco Company saw strong net sales growth in 2021 as it gained market share, driven by sales of its Vita Coco Coconut Water product.

For the year, the group generated record net sales of $380 million, up 22% on the year before. Meanwhile, gross profit rose to $113 million from $105 million. Cost pressures did impact margins; however, the company expects to pass some of the higher costs on to consumers in 2022.

Encouragingly, the company’s IRI tracked market share of coconut water in the United States rose 7% in 2021 to 49%, and household penetration rose by 180 basis points.

Looking ahead, the company expects demand for the current products to continue to grow, and it intends to increase its product offerings and brands to help drive growth within the business. For fiscal year 2022, it expects net sales growth of between 16% and 20%.

“Overall, we believe our business is healthy and our commercial platform can support our multiple growth initiatives for long-term growth. Demand for Vita Coco continues to grow, as evidenced by strong household penetration and retail scanner trends, and our positive growth outlook for fiscal year 2022 assumes continuation of this momentum and expected distribution gains, while assuming that our pricing actions do not fully cover the inflationary transportation cost effects, which we believe should recede once supply chains stabilize,” said Martin Roper the co-Chief Executive Officer.

Having combed through the full-year results, we see the recent insider trading at the business as bullish. Both insiders understand the beverage industry well and the outlook for the company appears to be positive. The shares have been weak since the recent IPO but the recent insider buying suggests that the two insiders believe the shares are oversold.

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