June Brings on Some Huge Insider Buying

So far in June, some insiders have made colossal purchases of shares of their companies. An entertainment giant and a restaurant operator were among these companies, as were a couple of consumer products makers. Note that this huge insider buying came largely from beneficial owners.

Let’s take a quick look at these notable transactions of the past week or so.

Is Insider Buying Important?

A well-known adage reminds us that corporate insiders and 10% owners really only buy shares of a company because they believe the stock price will rise and they want to profit from it. Thus, insider buying can be an encouraging signal for potential investors. This is all the more so during times of uncertainty in the markets, and even when markets are near all-time highs.

The first-quarter earnings-reporting season is all but over, so few insiders are prohibited from buying or selling shares for now. Below are some of the most notable insider purchases that were reported recently, starting with the largest and most prominent.

• Buyer(s): a director and 10% owner Endeavor Group
• Total shares: almost 1.6 million
• Price per share: $158.32 to $169.59
• Total cost: more than $250.1 million

TKO Group Holdings Inc. (NYSE: TKO) is the parent of Ultimate Fighting Championship and World Wrestling Entertainment. Endeavor acquired the bulk of the shares above from WWE founder Vincent McMahon. That lifted its stake to more than 4.1 million shares.

First-quarter results exceeded Wall Street’s expectations, but the share price is more than 2% lower since then and still within the purchase price range above. Analysts anticipate the stock will rise 9.8% in the next 12 months to their consensus price target of $182.16. All but three of 20 analysts who follow the stock recommend buying shares. J.P. Morgan recently maintained its Overweight rating.

Note that professional wrestler-turned-movie star Dwayne Johnson, who is a TKO director, exercised options on over 8,000 shares this month.

Twin Hospitality

• Buyer(s): 10% owner FAT Brands
• Total shares: over 7.1 million
• Price per share: $4.37
• Total cost: about $32.2 million

Dallas-based restaurant and sports bar operator and franchisor Twin Hospitality Group Inc. (NASDAQ: TWNP) spun off from FAT Brands Inc. (NASDAQ: FAT) earlier this year. Also, Twin Hospitality named a chief executive officer last month.

Despite a 45% pop in the past few days, the share price is still down 64% since the spin-off. So far, the stock has no analyst coverage and thus no consensus price target.

Twin Hospitality banners include breastaurant Twin Peaks and BBQ grill Smokey Bones. FAT Brands operates Fatburger, Johnny Rockets, Fazoli’s, and many others. Note that a FAT Brands director picked up some shares recently as well.

Solesence

• Buyer(s): 10% owner Bradford Whitmore
• Total shares: almost 6.9 million
• Price per share: $4.20
• Total cost: nearly $28.1 million

Shares of Illinois-based Solesence Inc. (NASDAQ: SLSN) recently began trading on the Nasdaq. Until earlier this year, the skincare products maker was known as Nanophase Technologies. It posted record first-quarter results. And the stock is up more than 60% year to date.

Here too, the stock has no analyst coverage and no consensus price target.

Note that this buyer also picked up some shares of battery maker Ultralife Corp. (NASDAQ: ULBI) last month.

Post

• Buyer(s): a director
• Total shares: more than 186,700
• Price per share: $109.115
• Total cost: less than $20.4 million

Though another insider parted with a small number of shares, this director stepped up and made a sizable purchase. His stake rose to nearly 4.3 million shares.

St. Louis-based packaged foods maker Post Holdings Inc. (NYSE: POST) recently announced an acquisition, and last month it reported better-than-expected second-quarter earnings. Its shares were last seen changing hands for more than the director’s purchase price. The stock is down about 3% year to date, but analysts anticipate it will increase 16.3% in the next 52 weeks to their mean price target of $126.73. Their consensus recommendation is to buy shares.

Tyra Biosciences

• Buyer(s): 10% owner R.A. Capital Management
• Total shares: more than 1.2 million
• Price per share: $9.32 to $10.18
• Total cost: more than $11.7 million

Tyra Biosciences Inc. (NASDAQ: TYRA) is an oncology-focused biotech that went public in 2019. Shares are trading for over 41% less than its IPO price but for a little more than the purchase price range above. The stock is up around 4% in the past month but underperformed the S&P 500 in that time.

All eight analysts covering the stock recommend buying shares, two of them with Strong Buy ratings. Their $30.14 consensus price target represents almost 193.5% upside potential in the coming year.

R.A. Capital Management has a Tyra Biosciences stake of about 21%. Note that the investment firm also recently acquired shares of Werewolf Therapeutics Inc. (NASDAQ: HOWL) and Mineralys Therapeutics Inc. (NASDAQ: MLYS).

And Other Insider Buying

In the past week, some insider buying was reported at Apple Hospitality REIT, Chemours, CVS Health, Deckers Outdoor, Fortinet, FS KKR Capital, Illinois Tool Works, Keurig Dr Pepper, MicroStrategy, Plug Power, Reynolds Consumer Products, Starz Entertainment, Topgolf Callaway Brands, Wendy’s, and Westlake as well.

Three Dividend Aristocrats Billionaires Continue to Buy in Bulk

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