Gary Mick, chief financial officer at Six Flags Entertainment (SIX), recently added 7,000 shares. The buy increased his holdings by nearly 21 percent, and came to a total cost just under $155,000.
He was joined by a director and a major holder, who both picked up 150,000 shares a day later. The total cost for those trades came to over $3.3 million each. Overall, there have been 20 insider buys and zero sales in the last year
Overall, company insiders own about 1.5 percent of shares, and major holders own most of the remaining float.
The theme park owner and operator is down 42 percent in the last year. Both earnings and revenue are down about 20 percent in the last year.
Many parks are shutting down now for the winter season, which could weigh on short-term profitability. However, share trade for under 13 times forward earnings, making for a decent value in the theme park space right now.
Action to take: Shares are down heavily from their highs, much further than the recent drop in the company’s operations. That sounds like a value opportunity, given the high barriers to entry for the sector and few players. Share are worth accumulating in the low $20 range, although investors won’t get paid a dividend.
For traders, the June 2023 $30 calls, last going for about $1.55, offer mid-double-digit returns on a move higher in shares 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.