Insiders Who Purchased US$1.43m Of Full House Resorts Stock May Not Have Expected 14% Tumble

The recent 14% drop in Full House Resorts, Inc.'s (NASDAQ:FLL) stock could come as a blow to insiders who purchased US$1.43m worth of stock at an average buy price of US$4.60 over the past 12 months. Insiders purchase with the hope of seeing their investments increase in value over time. However, due to recent losses, their initial investment is now only worth US$756.5k, which is not great.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

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The Last 12 Months Of Insider Transactions At Full House Resorts

In the last twelve months, the biggest single purchase by an insider was when Chief Executive Officer & Director Daniel Lee bought US$1.3m worth of shares at a price of US$4.75 per share. That means that even when the share price was higher than US$2.43 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

Happily, we note that in the last year insiders paid US$1.4m for 311.30k shares. But they sold 17.00k shares for US$77k. In total, Full House Resorts insiders bought more than they sold over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

View our latest analysis for Full House Resorts

Full House Resorts is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Full House Resorts Insiders Bought Stock Recently

There was some insider buying at Full House Resorts over the last quarter. Independent Director Eric Green shelled out US$35k for shares in that time. It's great to see that insiders are only buying, not selling. But the amount invested in the last three months isn't enough for us too put much weight on it, as a single factor.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. From our data, it seems that Full House Resorts insiders own 8.3% of the company, worth about US$7.6m. Whilst better than nothing, we're not overly impressed by these holdings.

What Might The Insider Transactions At Full House Resorts Tell Us?

Our data shows a little insider buying, but no selling, in the last three months. Overall the buying isn't worth writing home about. But insiders have shown more of an appetite for the stock, over the last year. The transactions are fine but it'd be more encouraging if Full House Resorts insiders bought more shares in the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Full House Resorts. For instance, we've identified 3 warning signs for Full House Resorts (1 can't be ignored) you should be aware of.

Of course Full House Resorts may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions of direct interests only, but not derivative transactions or indirect interests.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.