Lidar Company Ouster Just Saw Bullish Insider Buying
Following insider buying at smaller companies can be a very profitable trading strategy. Smaller companies are less researched than larger businesses, meaning that they offer greater potential for outperformance.
In this report, we are going to highlight some interesting insider buying at a small US-listed company, Ouster Inc (OUST:US). Ouster is an American lidar technology that builds high-resolution, digital 3D lidar sensors for use in autonomous vehicles, industrial, robotics, drones, mapping, defense, and security systems. It is listed on the New York Stock Exchange and currently has a market cap of approximately $232.92 million.
Insider Buying at Ouster
Our insider transaction data shows that on May 16 and May 23, three insiders at Ouster purchased stock. Those who bought shares were:
Co-Founder and CTO Mark Frichtl (25,700 shares @ $5.84 per share)
Co-Founder and CEO Angus Pacala (86,300 shares @ $5.81 per share)
Director Virginia Boulet (31,000 shares @ $6.07 per share)
Combined, the insiders invested $837,501 in the company.
What stands out here is that the two co-founders of the business, Angus Pacala and Mark Frichtl, have purchased company stock. There are unlikely to be many people who have a better understanding of the company, and its prospects, than these two individuals. It’s worth noting that these are the first stock purchases from the two insiders since the company hit the public markets in March 2021.
Another thing that’s worth highlighting here is the fact that Ms. Boulet has experience in the investment world. Previously, she was a Managing Director at investment banking firm Legacy Capital, LLC between 2014 and 2019. She also has considerable industry experience having served as Chair of Velodyne before the company merged with Ouster in late 2022.
Strong Growth in 2023
Ouster recently produced strong Q1 results.
For the quarter, revenue came in at $17.2 million, up 101% year on year and ahead of guidance. During the period, the company booked $33 million in business with new and existing customers and shipped over 3,000 sensors, up 95% year over year.
“Ouster had a strong first quarter of 2023 marked by significant customer demand for our new REV7 sensors, enabling us to both exceed our revenue expectations for the quarter and book $33 million in business with new and existing customers,” said CEO Angus Pacala.
Looking ahead, the company said that it expects to generate revenue of $18-$20 million in Q2. It also increased its target for Velodyne merger synergies to between $80 and $85 million by the end of Q4.
Since the company’s results, Ouster has announced an expansion of supply agreements with May Mobility to support autonomous vehicle deployments. These expansions include a binding commitment for a combined purchase of over one thousand Ouster OS1 and Alpha PrimeTM VLS-128 sensors through 2024 to meet demand for new autonomous vehicle deployments.
In light of these developments, we see the insider buying here as a bullish signal.
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