Samuel Di Piazza, a director at Warner Bros. Discovery (WBD), recently bought 17,346 shares. The purchase increased his position by 12%, and came to a total cost of $197,918.
This is the first insider buy since November, when the company’s International President bought 58,000 shares for over $535,000. There have been a mix of insider buys and sells over the past year, with the biggest move coming from a major holder who sold 10 million shares.
In total, Warner Bros. Discovery insiders own 9.3% of shares.
The media giant, like the sector overall, has struggled in recent years, even as shares have jumped higher by 34%.
2024 saw revenues drop 3%, and earnings growth was negative. Warner Bros. lost money overall thanks to some writedowns, and the company sports a -28% profit margin.
On the positive side, even after its big rally, shares trade at about 0.8 times their book value, which suggests that the company’s intellectual property is undervalued.
Action to take: WBD shares are in an uptrend, and the media giant is well off its year-end spike higher. Momentum investors may like shares here, as well as special situation investors given the merger interest in the media space.
For traders, the current momentum in shares makes the June $12.50 calls, last trading for about $0.83, attractive. The trade can likely see mid-double-digit returns on a further uptrend in WBD.
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.