Anyone interested in Dave & Buster's Entertainment, Inc. (NASDAQ:PLAY) should probably be aware that the Chief Development Officer, John Mulleady, recently divested US$194k worth of shares in the company, at an average price of US$32.79 each. That sale was 12% of their holding, so it does make us raise an eyebrow.
Dave & Buster's Entertainment Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Independent Chair of the Board & Interim CEO Kevin Sheehan bought US$961k worth of shares at a price of US$25.48 per share. Even though the purchase was made at a significantly lower price than the recent price (US$32.06), we still think insider buying is a positive. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.
In the last twelve months insiders purchased 114.25k shares for US$3.3m. But they sold 29.44k shares for US$916k. Overall, Dave & Buster's Entertainment insiders were net buyers during the last year. The average buy price was around US$28.75. We don't deny that it is nice to see insiders buying stock in the company. However, you should keep in mind that they bought when the share price was meaningfully below today's levels. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
See our latest analysis for Dave & Buster's Entertainment
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.
Insider Ownership
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 1.7% of Dave & Buster's Entertainment shares, worth about US$18m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At Dave & Buster's Entertainment Tell Us?
An insider hasn't bought Dave & Buster's Entertainment stock in the last three months, but there was some selling. But we take heart from prior transactions. We like that insiders own a fair amount of the company. So we're not overly bothered by recent selling. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Dave & Buster's Entertainment. For instance, we've identified 4 warning signs for Dave & Buster's Entertainment (1 shouldn't be ignored) you should be aware of.
Of course Dave & Buster's 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 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.