PLAYSTUDIOS, Inc. (NASDAQ:MYPS) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 8.2%, resulting in a US$56m rise in the company's market capitalisation. In other words, the original US$723k purchase is now worth US$943k.
Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.
The Last 12 Months Of Insider Transactions At PLAYSTUDIOS
In the last twelve months, the biggest single purchase by an insider was when Independent Director James Murren bought US$232k worth of shares at a price of US$4.78 per share. Even though the purchase was made at a significantly lower price than the recent price (US$5.80), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.
PLAYSTUDIOS insiders may have bought shares in the last year, but they didn't sell any. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
PLAYSTUDIOS is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insider Ownership of PLAYSTUDIOS
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. It's great to see that PLAYSTUDIOS insiders own 15% of the company, worth about US$108m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
What Might The Insider Transactions At PLAYSTUDIOS Tell Us?
There haven't been any insider transactions in the last three months -- that doesn't mean much. However, our analysis of transactions over the last year is heartening. Judging from their transactions, and high insider ownership, PLAYSTUDIOS insiders feel good about the company's future. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Case in point: We've spotted 1 warning sign for PLAYSTUDIOS you should be aware of.
But note: PLAYSTUDIOS may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
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, but not derivative transactions.
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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.