Insider Buys Additional US$50k In RCI Hospitality Holdings Stock

Even if it's not a huge purchase, we think it was good to see that Eric Langan, the Chairman of RCI Hospitality Holdings, Inc. (NASDAQ:RICK) recently shelled out US$50k to buy stock, at US$36.74 per share. Although the purchase is not a big one, by either a percentage standpoint or absolute value, it can be seen as a good sign.

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RCI Hospitality Holdings Insider Transactions Over The Last Year

Notably, that recent purchase by Chairman Eric Langan was not the only time they bought RCI Hospitality Holdings shares this year. Earlier in the year, they paid US$50.54 per share in a US$51k purchase. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$36.36). Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

While RCI Hospitality Holdings insiders bought shares during the last year, they didn't sell. Their average price was about US$42.42. I'd consider this a positive as it suggests insiders see value at around the current price. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

View our latest analysis for RCI Hospitality Holdings

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Does RCI Hospitality Holdings Boast High 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. We usually like to see fairly high levels of insider ownership. Insiders own 8.4% of RCI Hospitality Holdings shares, worth about US$27m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Do The RCI Hospitality Holdings Insider Transactions Indicate?

It's certainly positive to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. When combined with notable insider ownership, these factors suggest RCI Hospitality Holdings insiders are well aligned, and that they may think the share price is too low. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. To assist with this, we've discovered 2 warning signs that you should run your eye over to get a better picture of RCI Hospitality Holdings.

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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.