Insiders Now Seeing Red With TRUE At New 52-Week Low

In trading on Monday, shares of TrueCar Inc ( TRUE) touched a new 52-week low of $11.85/share. That's a $13.15 share price drop, or -52.60% decline from the 52-week high of $25.00 set back on 09/05/2014. Large percentage drops always require that the stock post even larger percentage gains from the low in order to recover the old price point, and for TRUE that means the stock would have to gain 110.97% to get back to the 52-week high. For a move like that, TrueCar Inc would need fundamental strength at the business level.

Here's a rhetorical question: Who knows more about fundamentals at the business level than the company's own insiders? So let's take a look to see whether any company insiders were taking the other side of the trade as TRUE shares were being sold down to this new 52-week low, focusing on the most recent trailing six month period. As summarized by the table below, TRUE has seen 4 different instances of insiders buying over the past six months.

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Purchased Insider Title Shares Price/Share Value
02/24/2015 Scott Painter CEO & Chairman of the Board 70,000 $17.53 $1,227,430.35
02/25/2015 Steven J. Dietz Director 2,000 $17.62 $35,233.20
02/25/2015 Christopher W. Claus Director 10,000 $17.70 $177,000.00
05/12/2015 John Krafcik President 7,500 $13.48 $101,100.00
05/13/2015 Scott Painter CEO & Chairman of the Board 13,885 $14.24 $197,666.86

In the short run, while the new 52-week low suggests the stock is at the cheapest price and perhaps therefore the best bargain it has been over the last 52 weeks, the low print also means anyone who has purchased the stock over that timeframe is staring at an unrealized loss. Oftentimes, that factor drives a stock's technical analysis metrics by creating overhead resistance, with investors who bought higher now anxious to reverse their trade once they are back to breakeven. The chart below shows where TRUE has traded over the past year, with the 50-day and 200-day moving averages included.

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