Insider Trading Report: WeWork (WE)

Sandeep Mathrani, CEO of WeWork (WE), recently bought 29,600 shares. The buy increased his stake by 1.7 percent, and came to a total price of just over $250,000.

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  • This marks the first insider activity since the company went public earlier in the year. Overall, insiders own about 2.3 percent of WeWork, which went public via a special purpose acquisition company, or SPAC in October.

    The work colocation company was originally set to be one of the largest IPOs a few years back, before the company’s unsustainable business model led to the offering being pulled. Shares of this more modest offering are now down about 20 percent since their IPO price.

    The company is still deeply unprofitable, and the pandemic may have led to a drop in the colocation business model for office real estate.

    Action to take: Further insider buying would be a better indicator that shares are done selling off from here and ready to move higher. That said, shares have been trending slightly higher in the past few weeks, and with insiders buying now, it could be a contrarian buy. Shareholders are a long way off from getting a dividend.

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  • For traders willing to bet on a move higher, the March $10 calls, last going for about $1.15, offer the potential for high double-digit returns in the months ahead if shares continue to move higher.

     

    Disclosure: The author of this article has no position in the company mentioned here, and does not intend to trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.