Mark Miller, President and COO of Goosehead Insurance (GSHD), recently bought 5,000 shares. The buy increased his position by 33 percent, and came to a total cost of $369,275.
He was joined by the company’s CFO, who bought a new position of 1,332 shares, valued at $99,714. And the company’s general counsel also made an initial buy of 1,000 shares valued at $73,460. Going further back, company insiders have generally been sellers of shares.
Overall, Goosehead insiders own 7.9 percent of shares.
The insurance agency franchise is up 56 percent over the past year. Improving economic conditions in 2023 led to earnings soaring by 623 percent, and revenues rose by 10 percent.
Plus, the company has a low level of leverage, with only $100 million in net debt on the balance sheet.
While insurance has been a slow market due to higher inflation, consumers tend to pay up rather than forego insurance. That should allow the company to continue its growth in the year ahead.
Action to take: Investors may like shares at current prices. The stock recently had a pullback in price from overbought levels. The longer-term uptrend looks likely to resume. Goosehead does not pay a dividend.
For traders, the June $90 calls, last trading for about $2.50, could see mid-to-high double-digit returns in the weeks ahead as shares resume their long-term uptrend.
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.