Bruce Thorn, President and CEO at Big Lots (BIG), recently bought 51,000 shares. The buy increased his holdings by 8 percent, and came to a total cost just over $247,000.
This marks the only insider buy at the company over the past two years. One company Executive Bice President was a regular seller of shares in 2021 and into early 2022, but insiders have been inactive for the past 14 months.
Overall, company insiders own 3.3 percent of shares.
The discount retailer has seen shares drop nearly 80 percent over the past year. The company has lost money and revenues have declined as discounters have been hit hard by high inflation.
Despite that drop, shares are priced at less than 0.05 times their price-to-sales, and at less than 0.3 times their book value. That’s a sign that the drop in shares may have gone too far, too fast, and that the stock is due for a rebound in the months ahead.
Action to take: Shares look oversold here, given the hit that discount retailers have taken in recent weeks.
Lower consumer spending overall and the drop in inflation should help these companies improve their operations in the years ahead. That makes shares a speculative buy, although Big Lots recently suspended its dividend.
For traders, the September $7.50 calls, last going for about $0.75, could see high-double-digit gains or better in the coming months.
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.