SHIM

Shimmick ($SHIM) Key Insider Sells $1M+ Over 10 Months Despite Operational Gains

12/02/2025 21:24

Shimmick Corporation ($SHIM) is an infrastructure construction specialist based in Irvine, California, focused on critical infrastructure projects including water and wastewater treatment facilities, dams, bridges, and mass transit systems. Founded in 1990 with approximately 1,200 employees, this small-cap company has been undergoing a strategic transformation toward water infrastructure and sustainable transportation, recently growing its backlog to $754 million and showing operational improvements. However, what investors should pay close attention to is the persistent selling pattern by a key insider. Director Mitchell B Goldsteen has been selling shares almost daily from December 2024 through September 2025. Most notably, on December 3, 2024, he sold 325,000 shares at $3.26 per share in a single transaction, cashing out over $1.06 million under a pre-arranged 10b5-1 trading plan established in August 2024. Goldsteen's selling didn't stop there. Starting in March 2025, he began systematically disposing of small lots almost daily. Within just two weeks from March 10-21, he sold 17,000 shares, followed by 43,000 shares in April and 33,000 shares in May. Remarkably, he continued selling even as the stock price dropped to the $1.30 range, raising market concerns about his persistent disposal pattern. Notably, Goldsteen holds securities indirectly through GOHO LLC, where he serves as the sole managing member. While he disclaims beneficial ownership except for pecuniary interest, his decisions effectively control the selling timing of these holdings. Other insider trading patterns show mixed signals. Director Brendan Herron purchased 17,000 shares over three consecutive days in August 2024, investing $52,000. However, CFO Todd Yoder made only a modest 2,000-share purchase in August 2025 worth $5,600, while Director Carolyn Trabuco conducted small sales in May 2025. This insider trading pattern creates an intriguing contrast with the company's recent operational improvements. Shimmick achieved positive adjusted EBITDA of $4 million in Q3 2025, marking its first positive quarter in four periods. The core Shimmick Projects segment grew revenue by 6% year-over-year to $107 million, with total revenue reaching $142 million. Backlog growth is also encouraging. As of October 2025, the company secured $754 million in backlog, up 15% quarter-over-quarter, with a book-to-burn ratio of 1.7x - the first time above 1.0x since early 2023. The company reports participating in over $1 billion monthly bidding activity in California and Texas regions. Yet financial health remains fragile. The company posted a $61 million net loss over the trailing twelve months, with shareholders' deficit of $52 million. Cash holdings of only $17 million continue to present liquidity pressures. Looking at stock price movements, Goldsteen's selling timing appears quite prescient. The stock peaked near $4.05 in July 2024 before beginning its decline, and when Goldsteen executed his major sale in December 2024, shares were trading in the low $3 range. The stock subsequently plummeted to $1.33 in April 2025 before recovering to current levels around $2.95. What investors must carefully consider is the disconnect between persistent insider selling and the company's operational improvement signals. Typically, insiders possess the most accurate information about future prospects, making their trading patterns important leading indicators. Goldsteen's continued disposal during a period of operational improvement may reflect his skeptical view of the company's long-term outlook or valuation. Currently, analysts maintain a neutral Hold rating on Shimmick with a $3 price target. However, persistent insider selling raises questions about such optimistic projections. Particularly concerning is that Goldsteen's selling appears systematic and sustained rather than driven by simple portfolio diversification or personal financial needs. While Shimmick's positioning in the growing water infrastructure market and increasing backlog are certainly positive, insider behavior suggests that translating these improvements into stock price appreciation may take considerable time. Investors should consider that upward price pressure may remain limited until Goldsteen completes his selling program.