The investment narrative surrounding Weave Communications presents a complex picture, characterized by a clear split between institutional and insider activity. While major funds have been accumulating shares, company executives and a significant stakeholder have been reducing their holdings. This divergence unfolds against a backdrop of solid revenue growth in the company’s latest quarterly report, creating a puzzle for market observers.
Financial Performance: Growth Amidst Losses
The third-quarter results for 2025 revealed a business demonstrating top-line expansion but still working toward consistent profitability. Key financial metrics from the period include:
* Revenue: $61.3 million, marking a 17.1% year-over-year increase.
* Margins: The GAAP gross margin improved to 72.3%, a gain of 30 basis points. The non-GAAP gross margin reached 73.0%.
* Profitability: The company reported a GAAP operating loss of $8.9 million, which widened from a $6.6 million loss in the prior-year period. However, on a non-GAAP basis, operating income was positive at $1.7 million.
* Cash Generation: A notable positive was the generation of $5.0 million in free cash flow. Operating cash flow for the quarter totaled $6.1 million.
* Other Metrics: The return on equity remained deeply negative at -42.10%, with a net margin of -14.32%. Analyst consensus projects a full-year earnings per share of -$0.33.
Institutional Accumulation Contrasts with Insider Selling
A significant 86.83% of the company’s equity is held by institutional investors, and several made substantial new investments or added to existing positions recently. During the second quarter of 2025, Frontier Capital purchased 2,033,023 shares, valued at approximately $16.9 million, giving it a 2.64% stake. Other funds, including Summit Securities Group, Ameritas Investment Partners, and Amundi, also reported new or increased positions in the first and second quarters.
This bullish institutional stance is countered by a wave of insider disposals. Over a 90-day period, insiders sold a combined 158,172 shares worth about $1.17 million, reducing their aggregate ownership to roughly 18.4%. Notable transactions include:
* Chief Operating Officer Marcus Bertilson sold 13,836 shares on September 16, 2025, at an average price of $7.73, reducing his direct holding by 3.93%.
* Director Tyler Newton divested 50,993 shares on November 5, 2025, at $6.68 per share, cutting his direct stake by half.
Adding to the selling pressure was a major move by large shareholder Crosslink Capital. After holding a 5.6% stake as of November 3, 2025, Crosslink-managed funds distributed 3,054,712 shares in-kind to their partners on December 3. Subsequently, on December 5, one Crosslink fund sold an additional 160,000 shares in the open market at a weighted average price of $6.47.
Should investors sell immediately? Or is it worth buying Weave Communications?
Analyst Perspectives and Valuation
Market experts remain divided on the stock’s outlook, reflected in a wide range of price targets:
* Data from MarketBeat shows an average target of $11.50 among five analysts, with a range from $8.00 to $15.00. This implies a potential upside of approximately 64% from recent trading levels.
* Stock Analysis reports a consensus rating of “Strong Buy” with a $12.20 average target (as of November 3, 2025).
* Nasdaq data (from November 17, 2025) lists a lower average one-year target of $10.63, within a $8.08 to $12.60 band.
* According to Ticker Nerd (data from December 10, 2025), the median price target from nine analysts is $10.50, suggesting around 57% upside from a $6.68 share price.
From a valuation standpoint, Weave trades at a price-to-sales multiple of 3x, which sits below the U.S. software industry average of 5.1x.
Recent Trading and Forward Look
Shares closed at $7.07 on December 11, 2025, rising 4.74% on the day within a range of $6.75 to $7.14. This marked the fifth consecutive positive trading session, contributing to a two-week gain of 10.99%. The stock’s 52-week trading range spans from $5.64 to $17.63.
The near-term sentiment is likely to continue being shaped by institutional flows and positioning changes among major holders. The company’s ability to sustain its marginal improvements in gross margin and free cash flow could lead analysts to revise their models upward. However, if operational losses persist, the current discounted valuation relative to peers may remain in place.
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