Stock Analysis

Don't Ignore The Fact That This Insider Just Sold Some Shares In Golden Entertainment, Inc. (NASDAQ:GDEN)

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Some Golden Entertainment, Inc. (NASDAQ:GDEN) shareholders may be a little concerned to see that the Independent Director, Anthony Marnell, recently sold a substantial US$990k worth of stock at a price of US$39.59 per share. However, that sale only accounted for 2.8% of their holding, so arguably it doesn't say much about their conviction.

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The Last 12 Months Of Insider Transactions At Golden Entertainment

In the last twelve months, the biggest single sale by an insider was when the Non-Independent Director, Lyle Berman, sold US$5.0m worth of shares at a price of US$24.96 per share. That means that even when the share price was below the current price of US$40.91, an insider wanted to cash in some shares. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. This single sale was just 17% of Lyle Berman's stake.

In the last year Golden Entertainment insiders didn't buy any company stock. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

NasdaqGM:GDEN Insider Trading Volume May 25th 2021

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).

Insider Ownership of Golden Entertainment

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Golden Entertainment insiders own 11% of the company, currently worth about US$131m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Golden Entertainment Insiders?

Insiders sold stock recently, but they haven't been buying. And even if we look at the last year, we didn't see any purchases. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Every company has risks, and we've spotted 2 warning signs for Golden Entertainment you should know about.

Of course Golden Entertainment 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, but not derivative transactions.

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