Insider Buying

B. Riley Financial continues to see insider buying

B. Riley Financial
(RILY:US)
12 months:
-17.57%
Activity:
Bullish
Pattern:
Purchase from board member
News:
Q2 results
B. Riley Financial
(RILY:US)
12 months:
-17.57%
Activity:
Bullish
Pattern:
Purchase from board member
News:
Q2 results

Insiders have access to real-time information on their companies and often also have a wealth of experience that can help them evaluate their firms’ prospects. If these individuals are buying company stock, it’s generally worth taking a closer look.

In this report, we are going to highlight some interesting insider buying at B. Riley Financial (RILY:US). B. Riley Financial is an American financial services company which, through its subsidiaries, provides financial solutions to public and private companies and high-net-worth individuals. It is listed on the Nasdaq and currently has a market cap of $1.55 billion.

Insider buying at B. Riley Financial

Our data shows that between August 1 and August 2, board member Randall E. Paulson purchased 37,500 RILY shares at an average price of $52.20 per share. This trading activity cost the insider approximately $1.96 million and increased his holding to 223,407 shares.

Investment experience

This insider trading activity is worth highlighting due to the fact that Mr. Paulson has considerable investment management experience. Previously, he was Managing Principal of Odyssey Investment Partners, LLC, where he served in this role between 2005 and 2019. Earlier in this career, he was at Bear, Stearns & Co. Inc. where he was a Senior Managing Director in the Mergers and Acquisitions and Corporate Finance groups. Prior to Bear Stearns, he was a member of GE Capital’s merchant banking group. Given his background, it’s fair to assume that he knows what he is doing here.

Management confidence

B. Riley Financial shares have underperformed recently, falling from near $90 at the end of last year to around $55 today. This reflects the tough market conditions the company has faced in 2022. As a result of the high level of market volatility, the company posted a net loss of $142.2 million in Q2, compared to a net profit of $73.9 million a year earlier.

However, management was confident that the company will bounce back. “As we look ahead, we remain optimistic about the total return potential of our investment portfolio, as well as our ability to capitalize on opportunities being presented by the current market dislocation," said Bryant Riley, Chairman and Co-CEO, in the latest results.

“With core capabilities in restructuring, asset disposition, and distressed financing, we believe our diversified platform stands to benefit during periods of market austerity,” added Co-CEO Tom Kelleher.

It’s worth noting that management declared a quarterly cash dividend of $1.00 per common share after the latest results, signaling that it is confident that profits will return in the future.

In light of this confidence from management, we see the insider buying here as a bullish indicator.

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