Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!
It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we’ll take a look at whether insiders have been buying or selling shares in Golden Entertainment, Inc. (NASDAQ:GDEN).
What Is Insider Selling?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. As Peter Lynch said, ‘insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.’
Golden Entertainment Insider Transactions Over The Last Year
In the last twelve months, the biggest single sale by an insider was when the Director, Lyle Berman, sold US$3.5m worth of shares at a price of US$24.50 per share. While we don’t usually like to see insider selling, it’s more concerning if the sales take price at a lower price. The good news is that this large sale was at well above current price of US$14.40. So it is hard to draw any strong conclusion from it. The only individual insider seller over the last year was Lyle Berman.
In the last twelve months insiders purchased 44340 shares for US$611k. But insiders sold 142k shares worth US$3.5m. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Insiders at Golden Entertainment Have Bought Stock Recently
It’s good to see that Golden Entertainment insiders have made notable investments in the company’s shares. Not only was there no selling that we can see, but they collectively bought US$377k worth of shares. This could be interpreted as suggesting a positive outlook.
Does Golden Entertainment Boast High Insider Ownership?
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. It appears that Golden Entertainment insiders own 11% of the company, worth about US$44m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Do The Golden Entertainment Insider Transactions Indicate?
The recent insider purchases are heartening. On the other hand the transaction history, over the last year, isn’t so positive. While recent transactions indicate confidence in Golden Entertainment, insiders don’t own enough of the company to overcome our cautiousness about the longer term transactions. In short they are likely aligned with shareholders. Of course, the future is what matters most. So if you are interested in Golden Entertainment, you should check out this free report on analyst forecasts for the company.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.