William Nettles, a director at Overstock.com (OSTK), recently bought 10,385 shares. The buy increased his stake by 25 percent, and came to a total cost of $50,644.
This marks the first insider buy at the company since last November, when Overstock’s CEO bought 4,000 shares. Two company directors have sold shares following the exercise of stock options, and the company’s CTO and General Counsel have also sold shares this year.
Overall, insiders own about 1.3 percent of the internet retailer.
Shares are down 8 percent over the past year, the mirror image for the returns in the S&P 500 over the same timeframe.
Like many retailers, Overstock is struggling amid a slowdown in consumer spending on goods. The company hasn’t made a profit over the last year, and revenues are down by a full 20 percent.
Action to take: The retailer has a strong balance sheet, and operates in a unique retail niche that could rebound if consumer spending remains focused on finding the best prices possible. The stock looks like an interesting speculative turnaround play at current prices.
For traders, shares had a big rally at the start of the summer and have given it up in the past few weeks. Shares look oversold and ready to rebound. The December $30 calls, last going for about $2.10, could see high-double-digit returns on a rally in shares going into the end of the year.
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 of the companies mentioned in this article.