Lawrence Cheng, a director at GameStop (GME), recently bought 4,140 shares. The buy increased his stake by 6%, and came to a total cost of $102,879.
Cheng was the last insider to buy, with a 10,000 share pickup back in April, paying just over $112,000. A few company insiders have been slight sellers of shares over the past few months. The highest share sale came in at $26 per share, even as shares have had a push to $60 per share.
Overall, GameStop insiders own 10.8% of shares.
The retail game outlet is up 5% over the past year. Shares have been increasingly volatile over the past few months, going from a low of $10 to a high over $60.
GameStop has been able to raise over $2 billion in cash, which now gives it a strong balance sheet with nearly no debt.
Action to take: While GameStop may issue more shares in the future and further dilute existing shareholders, doing so when prices surge can mean the company gets more valuable over time.
Long-term investors may be interested in shares on a drop under $20, as GME’s large cash position earning interest could turn the company profitable.
For traders, shares have gotten rangebound in the past few days in the mid-$20 range. The September $30 calls, last trading for about $4.20, could see mid-to-high double-digit returns on a rally in shares over the summer.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.