Paul Hennessy, a director at Shutterstock (SSTK), recently picked up 10,000 shares. The buy increased his stake by 47 percent, and came to a total price of just over $564,000.
This marks the first insider buy at the company in the past three years. Over that timeframe, most insider sales have come from the company’s Executive Chairman, who is also a major holder.
Even with the massive sales, company insiders still own 33.3 percent of the company.
Shares are down about 40 percent over the past year, and are down about half off of their 52-week high. Earnings are down about 10 percent in the past year, but earnings are up about 8 percent over the same time.
Action to take: The company has gone from 45 times earnings to 24 times in the past year. And the company has a solid balance sheet with a decent amount of cash and very little debt. Plus, shares pay a growing dividend with a starting yield of about 1.6 percent right here.
This all adds up to a tech company trading at a reasonable value that would be worthwhile to buy once shares stop their current downtrend.
For traders, the downtrend in shares is still likely in the coming months. The November $45 puts, last going for about $4.40, look like they could deliver mid-double-digit gains in the coming months before expiration.
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.