Top-level insiders such as C-suite executives tend to have a good understanding of their companies’ prospects. If they’re buying company stock, it’s often worth taking a closer look.
In this report, we are going to highlight an interesting purchase from a top-level insider at SeaWorld Entertainment Inc (SEAS:US). Headquartered in Orlando, Florida, SeaWorld owns and operates a portfolio of theme parks and water parks in the US. The company has a large collection of animals within its parks and takes an active role in animal rescue and rehabilitation. It is listed on the New York Stock Exchange and currently has a market capitalization of $3.7 billion.
Insider buying at SeaWorld Entertainment
Our data shows that on September 12, SeaWorld’s Chief Commercial Officer Christopher Finazzo purchased 8,950 shares at a price of $55.99 per share. This trade cost the insider $501,086 and increased his holding to 72,221 shares.
Mr. Finazzo is likely to have a good understanding of SeaWorld’s prospects as he is responsible for all commercial aspects of the business including revenue and marketing. He also has nearly 20 years of consumer experience, through a variety of leadership roles with major consumer brands, consulting, and financial services firms.
What stands out here is the size of the purchase. The fact that Mr. Finazzo has invested over half a million dollars in the company, and increased the size of his holding by 14%, suggests that he is very confident the stock is set to move higher.
SeaWorld’s recent Q2 results showed that the company is making a good recovery from the pandemic.
For the period, total revenue was a record of $504.8 million, an increase of 15% on Q2 2021, and an increase of 24% on Q2 2019. Meanwhile, attendance for the quarter was 6.3 million guests – only 3% below attendance in Q2 2019. Adjusted EBITDA came in at a record $234.4 million, up 7.1% year on year and up 57% on Q2 2019.
Encouragingly, management said that it expects the company’s performance to improve going forward. "While our second quarter and first half financial results were strong, these results still do not reflect a normalized operating environment and we still have significant scope to improve our execution and our financial results,” said CEO Marc Swanson. “As we continue to demonstrate, our business model is strong and resilient and we have significant opportunities to improve and grow our revenue and profitability,” he added.
It’s worth noting that the company took the opportunity to announce a new $250 million share buyback program in the Q2 results.
In light of these results, and the fact that the stock is trading at a large discount to the broader market, we see the insider buying here as a bullish indicator.