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Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of Bally's Corporation (NYSE:BALY), it sends a favourable message to the company's shareholders.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.
View our latest analysis for Bally's
Bally's Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when President & Director George Papanier bought US$189k worth of shares at a price of US$9.46 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$17.07. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.
Bally's insiders may have bought shares in the last year, but they didn't sell any. 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!
Bally's is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.
Insider Ownership
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Bally's insiders own 15% of the company, currently worth about US$106m 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 Do The Bally's Insider Transactions Indicate?
The fact that there have been no Bally's insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. It would be great to see more insider buying, but overall it seems like Bally's insiders are reasonably well aligned (owning significant chunk of the company's shares) and optimistic for the future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. While conducting our analysis, we found that Bally's has 2 warning signs and it would be unwise to ignore them.