Lawrence Cheng, a director at GameStop Corp. (GME), recently bought 5,000 shares. The buy increased his holdings by 13 percent, and came to a total cost of $113,900.
The buy came a year after another director bought 1,500 shares, paying just under $195,000. Over the past two years, insider buys have far exceeded insider sales, including a 100,000 share buy from the company’s chairman just over a year ago.
Overall, insiders own 15.5 percent of shares.
The video game retailer has slid by about 46 percent in the past year, but shares are still significantly higher on a split-adjusted basis from its short squeeze in 2021.
GameStop just reported a profitable quarter, and the company issued shares at a far higher price to clear debt off its balance sheet over a year ago.
Action to take: Shares look oversold over the long term, and short interest has increased in recent months, which could lead to another squeeze higher at some point, especially as the company’s operations have improved. At the moment, the stock does not pay a dividend.
For traders, the July $30 calls, last going for about $1.70, offer mid-double-digit gains on a pop higher in shares in the coming months. Traders should look for a quick profit, as shares are volatile in either direction.
Disclosure: The author of this article has a position in the company mentioned here, and may further trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.