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A Big Insider Buy Launches Planet Labs Higher
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A Big Insider Buy Launches Planet Labs Higher

When insiders buy stock, it tends to bolster confidence. After all, the people closest to the operations are more likely to know what’s going on within a company. Thus, a big insider buy at satellite imaging company Planet Labs (NYSE:PL) sent share prices blasting up on Friday, closing up over 13%.

The buy came from Planet Labs’ president of product and business, Kevin Weil. Weil bought just under $1 million worth of stock, picking up 274,000 total shares valued at $3.64 per share. That brought Weil up to a total of 1.4 million shares held directly and 439,580 shares held indirectly. A look at other insider trading going on at Planet Labs shows insiders—Weil included—buying and selling shares, mostly in a non-informative fashion. However, overall, insider sentiment is trending positive, thanks largely to Weil’s informative buy. His was the only such buy in the last three months.

So what fueled Weil’s buy? A look at the latest earnings report, released about a week ago, should tell some of what’s going on. Planet Labs is roughly down 70% from its highest point, which may have prompted a purchase. Further, Planet Labs’ acquisition of Sinergise might throw some extra value into the satellite imaging operations. The biggest potential reason comes from a classic Peter Lynch quote: “Insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.”

Analysts, meanwhile, are solidly in Planet Labs’ corner on this one. With five Buy recommendations and one Hold, Planet Labs stock is classified as a Strong Buy. Further, with an average price target of $8 per share, it boasts 92.77% upside potential.

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