PAPL

Pineapple Financial ($PAPL) Executives Buy Over 1 Million Shares As Stock Craters 87% - Bargain Hunting Or Desperate Measure?

05/22/2025 22:22

Executives at Pineapple Financial Inc ($PAPL) have been aggressively buying shares as the stock plunges to record lows, signaling potential confidence amid a dramatic market selloff. Shares of the Canadian fintech company have collapsed approximately 87% since October 2024, falling from around $0.67 to just $0.09 as of mid-May 2025. The decline accelerated sharply in late April and early May, dropping from $0.27 to under $0.10 in just two weeks. Against this backdrop of plummeting share prices, SEC filings reveal significant insider buying activity beginning in mid-May. COO Kendall Marin purchased a total of 807,657 shares between May 16-20 for approximately $21,638, at average prices ranging from $0.02 to $0.03 per share. CEO Shubha-jeet Dasgupta acquired 33,000 shares on May 21 for $1,980 (at $0.06 per share), while Director Tasis Anastasios Giannoukakis purchased 177,012 shares across May 20-21 for roughly $9,845. Notably, these purchases occurred at share prices roughly 90% lower than previous insider buys in July-August 2024, when executives were purchasing at $0.88-$1.14 per share. Pineapple Financial specializes in mortgage brokerage and insurance services, leveraging cloud-based tools and artificial intelligence to enhance experiences for mortgage brokers and their clients. The company operates a network supporting hundreds of brokers across Canada and recently diversified by launching an insurance vertical offering life, creditor, and disability insurance products in partnership with Industrial Alliance. Financial performance shows mixed signals. For fiscal year 2024 (ended August 31, 2024), Pineapple reported revenue of $2.69 million, up 7.5% year-over-year, while gross billings increased 8.2% to $16.26 million. However, net losses widened significantly to $4.10 million, compared to $2.81 million in the previous year – a 45.9% increase. Loss per share grew to $0.57 from $0.45, representing a 26.7% deterioration. Early fiscal 2025 data (September-November 2024) showed accelerating growth metrics, with volume increasing 13.3% year-over-year, gross billing up 13.9%, and net revenue growth of 20.8%. The company has targeted achieving monthly profitability by April 2025, though this goal predated the recent stock collapse. Pineapple's balance sheet reveals total assets of $4.10 million against liabilities of $2.75 million, resulting in shareholders' equity of $1.35 million and a concerning debt-to-equity ratio of approximately 2.04. The company completed its IPO on the NYSE American exchange in 2024, raising $3.5 million to fund growth initiatives and technology investments. "The insider buying cluster we're seeing at Pineapple Financial presents an interesting signal in the context of such a severe stock decline," said Jordan Harper, fintech analyst at Meridian Capital. "Multiple executives putting their own capital at risk suggests they may believe the market has overreacted. However, the widening losses and high leverage raise legitimate concerns about the company's financial trajectory." The recent purchases represent a substantial commitment relative to the company's diminished market capitalization of approximately $2.49 million. For context, the combined insider purchases of over $33,000 in May 2025 represent more than 1.3% of the entire company's market value. Pineapple has invested significantly in AI-driven mortgage technology, with $1.11 million in intangible assets reported in its financial statements. The company's strategy focuses on technology development, expansion of subscription services, growing mortgage brokerage volumes, and scaling its insurance vertical. While the Canadian mortgage market has benefited from recent Bank of Canada interest rate cuts, Pineapple faces challenges as a small player in a competitive landscape dominated by larger financial institutions. The company's small size and continued losses make it particularly vulnerable to market volatility and economic headwinds. Investors weighing Pineapple Financial should consider both the potentially positive signal from the insider buying cluster and the concerning financial metrics and market positioning. The dramatic price decline may represent either a significant opportunity if executives' confidence is justified or a warning sign of deeper structural problems. Upcoming quarterly results and progress toward the stated profitability target will be critical in determining whether this insider buying cluster marks a turning point or merely a vote of confidence amid ongoing challenges for the struggling fintech company.

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