One of the most bullish insider transaction patterns is ‘cluster buying.’ This is where three or more insiders have purchased company stock within a short period of time.
In this report, we are going to highlight recent cluster buying at Bluegreen Vacation Holding Corp (BVH:US). Bluegreen Vacation is a vacation ownership company that markets and sells vacation ownership interests and manages resorts in popular leisure and urban destinations across the US and the Caribbean. Established in 1966, the group has grown to become a leader in vacation ownership with over 220,000 owners. It is listed on the New York Stock Exchange and currently has a market capitalization of $669 million.
Bluegreen Vacation Holding Corp: Insider Buying
Our data shows that between November 8 and November 18, three insiders at Bluegreen Vacation purchased stock around the $30-$32 level. Those who bought shares were:
- CEO and Chairman Alan Levan (32,915 shares)
- Vice Chairman John Abdo (28,424 shares)
- Chief Sales Officer Dusty Tonkin (3,100 shares)
Combined, these three insiders spent around $2 million on BVH stock.
This insider activity caught our attention due to the size of the trades. This cluster of purchases represents the largest amount of insider buying within a quarter at Bluegreen Vacation for many years. This suggests that insiders are very confident the stock is set to move higher. Our Insider Model views this buying pattern as very bullish.
It’s worth noting that the last time multiple insiders bought stock here, in May of 2021, the stock outperformed. Over the next six months, the stock rose around 60%, beating the broader US market by a wide margin.
Strong Performance in Q3
Bluegreen Vacation’s recent Q3 results showed that the company is making a good recovery after the pandemic.
For the period, total revenue amounted to $214.5 million, up 48.3% year on year, and up 6% on Q3 2019. Meanwhile, adjusted earnings per share came in at $1.06, compared to a loss of $1.35 per share a year earlier. This earnings figure was well ahead of the consensus forecast of $0.66 per share. Adjusted EBITDA of $42.7 million was a record for Q3.
During the quarter, the company generated an all-time record of system-wide sales of vacation ownership interests (VOIs) and an all-time record of sales of vacation packages. As a result of this strong performance, it was able to repurchase 1,007,000 shares for an aggregate purchase price of $20.9 million.
“We are excited by our third quarter results and energized and hopeful about the future,” commented the CEO.
In light of these results, we see the insider buying here as a bullish indicator.