Lecil Cole, CEO at Calavo Growers (CVGW) recently added 75,000 shares. The buy increased the CEO’s stake by 17 percent, and came to a total cost of $2.275 million.
The CEO Was joined by a director two days later, who bought 2,000 shares, increasing his stake by 6 percent. Over the past year, one director has been a seller, while the CEO has bought on three occasions so far.
Overall, insiders own 3.4 percent of the company.
The produce grower is down slightly over the past year, but shares have been trending higher in recent sessions. Revenue slid by a quarter last year, and Calavo is not yet profitable.
However, company insiders are bullish, and shares now trade at just two-thirds their price to sales. Add in strong prices for produce, and it’s likely that the company can return to profitability in the coming quarters.
Action to take: Long-term investors may like shares at current prices, with the potential to buy on a pullback. Calavo pays a 1.4 percent dividend yield at the moment, with the potential for an increased payout over time.
For traders, options are limited. But the October $40 calls, last going for about $2.50, could see mid-double-digit gains should shares continue to rise in the weeks ahead.
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.