Well-informed insiders at U.S. electric vehicle (EV) maker Fisker (FSR) are loading up on the company’s stock. The most recent informative buy, as rated by TipRanks, increased one key individual insider’s holding in FSR stock by 258% in November, and investors should take note.
Although Fisker is a fairly new pre-revenue stage EV producer founded by Henrik Fisker and his wife Geeta Gupta-Fisker in 2016, its volatile stock has doubled over the past 24 months.
I am bullish on FSR stock. (See Insiders’ Hot Stocks on TipRanks)
Interestingly, the last 10 months have seen a series of significant insider buy transactions on Fisker stock. The most recent big purchase was a near $1 million investment by an independent Director Mark Hickson reported on November 17.
Significant Insider Buying Ongoing at FSR Stock
Insiders at Fisker have bought over $1.3 million worth of FSR stock over the past three months. The number excludes all insider transactions that the TipRanks Insider Activity tool considers non-informative.
Insiders have generally been actively buying Fisker stock since March this year, and the trend has held throughout 2021.
Insiders who recently bought FSR stock included Chief Accounting Officer John Finnucan and Directors Mark Hickson, Wendy Greuel, and William McDermott.
William McDermott is a highly ranked Four-Star corporate insider. He has an impressive historical performance record as a corporate insider. He directly purchased nearly $250,000 worth of FSR stock in the public market on November 17. His transactions could carry a significant signaling value.
Mark Hickson’s recent purchases increased his total interest in Fisker stock by 258%. Mark joined the Fisker Board back in July 2020. One could confidently say that, by now, Mr. Hickson has a better and deeper knowledge and understanding of FSR’s business, its risks, and the opportunities ahead of the ambitious EV start-up.
With deep insider knowledge, Mark was confident enough to invest over $984,000 of his personal funds in Fisker this month. If that is not a bullish signal for Fisker stock, perhaps nothing else is.
Mark and William are independent directors in FSR, and both are members of Fisker’s Audit Committee.
Should You Invest in Fisker Stock Right Now?
Although Fisker is still a pre-revenue start-up with significant business and execution risk, its founders have had extensive experience. Its balance sheet is strong, and its recently unveiled flagship electric SUV, the Fisker Ocean, already threatens to beat Tesla (TSLA) over driving range.
Further, investors pondering on buying FSR stock could take the recent insider transactions as a bullish signal that could be too costly to ignore right now.
Most noteworthy, customers are already placing orders on the Ocean. Cash-flow-related risks could begin to subside soon.
TipRanks’ Smart Score
Interestingly, Fisker stock scores a 9 out of 10 on the TipRanks Smart Score, implying significant potential to outperform the market over the next 12 months.
See Top Smart Score Stocks on TipRanks >>
Investor Takeaway
Fisker stock has been highly volatile over the past 24 months. Heavy insider ownership could help partly explain that phenomenon.
Corporate insiders own more than 46% of Fisker stock; institutions control another 26%. This leaves just about 27% of the available float for the general public to trade. Insiders and corporations usually hold positions for the long term and deplete the supply available for retail traders to buy.
That said, the company has secured battery supplies. FSR could soon start earning some revenue, generate some decent cash flows, and de-risk its business profile.
As insiders scoop more shares on the public market, investors may want to load up some more for long-term outperforming returns.
Wall Street’s Take
Turning to Wall Street, Fisker stock earns a Moderate Buy consensus rating. This is based on six Buys and two Holds assigned in the past three months.
The average target price on FSR stock of $26 a share implies 21.3% upside over the next twelve months.
Disclosure: At the time of publication, Brian Paradza did not have a position in any of the securities mentioned in this article.
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