Philip Satre, a director at Wynn Resorts (WYNN), recently bought 22,200 shares. The buy increased his stake by a hefty 67%, and came to a total cost of just over $2.04 million.
This marks the first insider buy at Wynn over the past two years. Insiders have been slight sellers of shares, with about half of sales occurring following the exercise of stock options. Sales include the company CEO and CFO.
Overall, Wynn Resorts insiders own 27.1% of shares.
The resort owner and operator is down 11% over the past year. While consumers have been willing to spend money on experiences in recent years, that hasn’t translated into increased profitability for Wynn.
Total revenues were flat over the past year, and earnings growth has slid 62%. However, with shares trading at 16 times forward earnings, and with Wynn being a leader in the luxury resort space, the stock looks undervalued here.
Action to take: Shares have been trending higher since the latest earnings report over the past few days. That trend looks likely to continue, pointing towards a push higher in the months ahead.
At current prices, Wynn pays a 1.1% dividend.
For traders, the June $100 calls, last trading for about $4.30, could see mid-double-digit returns on a further rally in the months ahead.
Disclosure: The author of this article has a position in the company mentioned here, but does not intend to trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.