What Happened?
Shares of online used car auction platform ACV Auctions (NASDAQ: ACVA) jumped 5.1% in the afternoon session after a director, Brian Hirsch, reported a significant open-market purchase of company stock.
According to a regulatory filing, Hirsch acquired 80,571 shares of Class A common stock at a weighted average price of $6.21 per share. Such a substantial investment by a key insider was often interpreted by the market as a strong vote of confidence in the company's future prospects and current valuation. This type of insider activity frequently led to increased investor optimism, as it suggested that those with intimate knowledge of the business believed the stock was undervalued.
After the initial pop the shares cooled down to $6.46, up 3.4% from previous close.
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What Is The Market Telling Us
ACV Auctions’s shares are very volatile and have had 22 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 4 days ago when the stock gained 10.4% on the news that a director, Robert P. Goodman, disclosed a significant purchase of company shares worth over $5.1 million. According to filings with the SEC, Goodman acquired 912,408 shares of common stock at a weighted average price of $5.61. This large purchase by a high-level insider was seen by investors as a strong signal of confidence in the company's future direction. Such transactions often suggest that leadership believes the stock is undervalued or that positive developments are on the horizon, which can encourage other investors to buy shares.
ACV Auctions is down 69.2% since the beginning of the year, and at $6.46 per share, it is trading 72.1% below its 52-week high of $23.17 from December 2024. Investors who bought $1,000 worth of ACV Auctions’s shares at the IPO in March 2021 would now be looking at an investment worth $206.56.
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