Origin Materials, Inc. (NASDAQ:ORGN) Co-CEO and Director Richard J. Riley has recently increased his holdings in the company through a significant purchase of common stock. According to a recent SEC filing, Riley acquired 300,000 shares at a price of $1.00 per share, totaling $300,000. This transaction was executed under a 10b5-1 plan, a prearranged trading plan that allows insiders to buy or sell shares at predetermined times. Following this transaction, Riley owns a total of 749,083 shares indirectly through the Riley Investment Trust I. Additionally, he holds 707,832 shares via the Riley Separate Property Trust and 1,318,070 shares directly.
In other recent news, Origin Materials, Inc. reported significant developments in its Third Quarter 2024 Earnings Call. The company announced its readiness to commence commercial production of its innovative PET caps, following a successful test of its CapFormer System, which achieved over 98% efficiency. Origin Materials also reported an increase in Q3 revenue to $8.2 million, up from $7.1 million year-over-year, and maintains a strong cash position of $113 million.
The company has plans to deploy at least eight CapFormer Systems by the end of 2025, marking a significant scale-up in production. The initial revenue from its caps and closures business is expected in Q1 2025, with positive EBITDA projected for the first half of 2026. Origin Materials also has a $100 million MOU in place and is in ongoing discussions for more business in caps and closures.
Despite a decrease in the cash balance from the previous year, the company remains strategically positioned to capture market share in the caps and closures industry, with significant revenue growth anticipated starting in 2025. These recent developments indicate an aggressive expansion strategy and a strong focus on the profitability of the caps and closures segment.
InvestingPro Insights
Origin Materials, Inc. (NASDAQ:ORGN) has recently seen insider buying activity, with Co-CEO Richard J. Riley significantly increasing his stake in the company. This move comes at a time when the stock appears to be undervalued according to several metrics from InvestingPro.
As of the latest data, ORGN's stock price stands at $1.03, which is 54.21% of its 52-week high. This pricing aligns with an InvestingPro Tip indicating that the stock's RSI suggests it is in oversold territory. Additionally, the company's Price to Book ratio is 0.42, further supporting the notion that the stock may be undervalued.
Despite the recent insider purchase and potential undervaluation, investors should be aware of some challenges facing the company. An InvestingPro Tip highlights that Origin Materials is quickly burning through cash, which could be a concern for long-term sustainability. This is reflected in the company's financials, with an operating income of -$69.67 million over the last twelve months as of Q3 2024.
On a positive note, Origin Materials has shown strong revenue growth, with a 123.12% increase over the last twelve months. However, the company's gross profit margin remains low at 11.37%, which an InvestingPro Tip flags as a weakness.
For investors considering ORGN, it's worth noting that InvestingPro offers 12 additional tips that could provide further insights into the company's financial health and market position. These additional tips could be particularly valuable given the mixed signals from the current data and the recent insider buying activity.
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