Insider buying can provide clues about a stock’s next move. Insiders sell company stock for a number of reasons. Yet they only buy stock for one reason – they expect it to rise.
In this report, we are going to highlight some interesting insider buying at Trustpilot Group (TRST:LN). Trustpilot is the owner of trustpilot.com – a consumer review website that hosts reviews of businesses worldwide. Currently, over 700,000 domains have been reviewed on the website, with over 167 million reviews left by consumers. The company is listed on the London Stock Exchange and has a market cap of around £397.5 million at present.
Our data shows that on September 19, Chair Zillah Byng-Thorne purchased 150,000 shares at a price of £0.93 per share. This trade cost the insider approximately £140,000 and increased her holding to 631,761 shares (+31%).
Now, this isn’t the only insider buying here recently. On the same day, new CEO Adrian Blair purchased 150,004 shares at a price of £0.95 per share. He then bought another 33,196 shares on September 20. However, these trades – his first since joining the company on September 13 – are most likely linked to his contract.
Trustpilot recently produced solid H1 results that were better than expected.
For the period, revenue was up 18% year on year at constant currency to $84.6 million. Meanwhile, adjusted EBITDA was $5.7 million versus an EBITDA loss of $5.4 million a year earlier. Positive free cash flow resulted in period-end net cash of $82.7 million and no debt.
Looking ahead, the company maintained its outlook for mid-teens constant currency revenue growth for the full year. However, it said that adjusted EBITDA will exceed market expectations.
“Our business delivered a strong first-half performance enabling us to move to adjusted EBITDA profitability and positive free cash flow earlier than originally forecast,” wrote the company.
“The board remains confident in the business delivering sustainable growth and operating leverage over the long term and in the significant and growing long-term market opportunity,” it added.
In light of these better-than-expected results, we see the insider buying here as a bullish development.
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