What happened
Shares of gambling-industry supplier Everi Holdings Inc (EVRI -0.24%) jumped as much as 44.6% in early trading Tuesday after it was revealed that a number of insiders had bought stock. The pop didn't last long, though, and shares were back down to a 12% gain on the day at 3 p.m. EDT.
So what
A number of insiders have acquired shares in the last week, but the two notable moves in today's SEC filings were directors Eileen Raney buying 20,000 shares and Maureen Mullarkey buying 10,000 shares. Their average purchase price was $6.00 and $6.27, respectively, more than double where shares are trading today.
Image source: Getty Images.
The market is moving quickly, but if directors were bullish on Everi's stock at over $6 per share then buying them below $3, where they're trading today, could be seen as a steal. And that's why shares jumped today.
Now what
The real challenge for Everi is that most of its customers are shutting down operations and don't know when they'll reopen. Casinos could be in cost-saving mode when they do open, so suppliers like this could get pinched.
I wouldn't buy on an insider acquisition alone, but if Everi is going to come out of the current crisis, it could be a good casino stock, given that shares were trading five times higher just a month ago.
