Sardar Biglari, Chairman & CEO of Biglari Holdings (BH), recently added 28,966 more shares. The buy increased his stake by 2.25 percent, and came to a total cost of just over $4.62 million.
Biglari was the most recent buyer as well with a pickup back in August, before shares traded 40 percent higher. He and other insiders have been active over the past three years, with every transaction involving the pickup of shares.
Overall, insiders own 0.5 percent of company shares. Shares of the restaurant holding company have performed about in-line with the S&P 500 over the past year following the latest pullback in shares.
The company is currently struggling, with earnings and revenue down over the past year. But the company has a 21 percent profit margin, which is huge for the restaurant industry. And the company has as much cash as debt on the balance sheet, which indicates that it’s strong enough to deal with any uncertainty.
Action to take: Large insider buys tend to be a healthy sign that a turnaround could be on the horizon, although investors and traders may want to wait for improving financial numbers before getting in. Investors may want to consider getting in when a new uptrend starts, as the stock doesn’t pay a dividend so shareholders can’t get paid to wait.
As the company is relatively small with a market cap just under $500 million, there are no options available to trade on shares at this time. Traders can likely look for a turnaround on a technical basis to play a move higher in shares.”
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.