Insider Stock Buying Reaches US$1.31m On Lions Gate Entertainment

Simply Wall St · 07/01 10:06

Multiple insiders secured a larger position in Lions Gate Entertainment Corp. (NYSE:LGF.A) shares over the last 12 months. This is reassuring as this suggests that insiders have increased optimism about the company's prospects.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

See our latest analysis for Lions Gate Entertainment

The Last 12 Months Of Insider Transactions At Lions Gate Entertainment

In the last twelve months, the biggest single purchase by an insider was when insider John Harkey bought US$852k worth of shares at a price of US$8.52 per share. That implies that an insider found the current price of US$9.42 per share to be enticing. That means they have been optimistic about the company in the past, though they may have changed their mind. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. Happily, the Lions Gate Entertainment insiders decided to buy shares at close to current prices.

While Lions Gate Entertainment insiders bought shares during the last year, they didn't sell. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

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NYSE:LGF.A Insider Trading Volume July 1st 2024

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

Does Lions Gate Entertainment Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Insiders own 3.9% of Lions Gate Entertainment shares, worth about US$82m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Lions Gate Entertainment Insiders?

The fact that there have been no Lions Gate Entertainment insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. Insiders do have a stake in Lions Gate Entertainment and their transactions don't cause us concern. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Lions Gate Entertainment. Be aware that Lions Gate Entertainment is showing 2 warning signs in our investment analysis, and 1 of those is a bit concerning...

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.