Corporate insiders have far more information on their companies than outsiders do. 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 Lions Gate Entertainment Corp (LGF/A:US). Lions Gate Entertainment is a global content company that is engaged in motion picture production and television production. It also has a growing presence in interactive games and location-based entertainment, virtual reality, and other new entertainment technologies. The company is listed on the New York Stock Exchange and currently has a market capitalization of $3.2 billion.
Lions Gate Entertainment Corp: Insider Buying
Our records show that between 11 March and 12 March, board member and Co-Chair of the Strategic Advisory Committee, Gordon Crawford, purchased 100,000 shares in Lions Gate Entertainment Corp. The average price he paid for his shares was $15.59. Overall, the insider spent $1.6 million on stock.
Investment Management Background
This insider trading activity is worth highlighting for two main reasons. Firstly, Crawford has made a number of well-timed purchases in the recent past. Last year, for example, he purchased stock in August near the $7.50 level and in November near the $8.50 level. Since then, the stock has risen to $16.
Secondly, Mr. Crawford has a background in investment management and is a long-time investor in the media industry. Previously, he was a portfolio manager at Capital Research and Management, a privately-held investment management company. This background means he is likely to know what he is doing.
While Lions Gate’s recent third-quarter results weren’t amazing due to continued theatrical closings, there were definitely some signs of progress.
For example, in Q3, the company's film and television library achieved record TTM revenue of $765 million with its second-best revenue quarter ever. Meanwhile, Television Production segment revenue was up 20.5% from the prior year quarter at $228.2 million, driven by strong television library revenues and the performance of 3 Arts Entertainment in the quarter. Global over-the-top (OTT) subscribers rose to 14.6 million from 13.7 million at the end of the second quarter.
Looking ahead, management was confident in relation to the outlook for the company. "With the strong year we're having in F21, we're in great shape to take advantage of the imbalance between content supply and demand in the current environment with an increased investment in content and marketing across our core businesses in F22," said Lions Gate Entertainment CEO Jon Feltheimer.
In light of this confident tone, we see the insider buying here as bullish.