Fat Brands, Inc. (NASDAQ:FAT) director Mark Elenowitz has recently increased his stake in the company with a series of purchases of the company's Series B Cumulative Preferred Stock. The transactions, which took place on August 21 and 22, 2024, involved the acquisition of a total of 3,000 shares at prices ranging from $10.80 to $11.04 per share, amounting to a total investment of $32,482.
The first transaction on August 21 saw Elenowitz acquire 344 shares at $11.04 each. The following day, he expanded his holdings by purchasing an additional 2,656 shares, this time at a slightly lower price of $10.80 per share. These transactions have raised Elenowitz's total ownership to 3,000 shares of preferred stock in Fat Brands directly.
Fat Brands, known for its portfolio in the retail-eating places sector, has its headquarters in Beverly Hills, California. The company has been expanding its presence and brand portfolio, which may have influenced Elenowitz's decision to increase his investment.
Investors often watch the buying and selling activities of company insiders, such as directors and officers, for insights into their perspective on the company's future performance. Transactions like these can be seen as a sign of confidence from insiders in the company's value and potential.
For those following Fat Brands' stock movements, the recent insider buying activity could be a point of interest, especially when considering future investment decisions regarding the company's stock.
In other recent news, FAT Brands Inc. has made significant strides in its financial performance and strategic growth. The company reported a substantial increase in total revenue by 42.4% to $152 million and a rise in system-wide sales by 7.3% to $614.7 million in its second quarter of 2024 earnings call. Despite a net loss of $39.4 million for the quarter, FAT Brands has plans to expand its operations by opening 120 new units this year, primarily focusing on the polished casual segment.
In addition to the revenue growth, the company announced a monthly cash dividend for its Series B Cumulative Preferred Stock of $0.171875 per share for the month ending August 31, 2024. The company's commitment to returning value to its shareholders through regular dividends is often seen as a sign of financial health and stability.
In recent developments, FAT Brands is considering acquisitions in categories such as salad, sandwich, and coffee brands. The Georgia-based manufacturing facility contributed $3.8 million to adjusted EBITDA in Q2, a 9.3% increase from last year. These are some of the recent highlights that reflect the company's strategic growth and financial performance.
InvestingPro Insights
As Fat Brands, Inc. (NASDAQ:FAT) garners attention with insider buying activity, a closer look at the latest metrics and insights from InvestingPro can provide a deeper understanding of the company's financial health and future prospects. With a market capitalization of approximately $92.38 million, Fat Brands operates within a challenging space, characterized by its significant debt burden (InvestingPro Tip #0) and a notable dividend track record, having raised its dividend for three consecutive years (InvestingPro Tip #1).
InvestingPro data reveals that the company has experienced robust revenue growth over the last twelve months as of Q2 2024, with an increase of 36.36%, and a quarterly revenue growth of 42.41% in Q2 2024. Despite this, analysts have concerns about the company's profitability, as they do not anticipate Fat Brands will be profitable this year (InvestingPro Tip #7). The company's gross profit margin stands at 27.24%, indicating its ability to retain a reasonable portion of sales as gross profit.
While the dividend yield is quite significant at 10.65%, reflecting the company's commitment to returning value to shareholders, the stock has been volatile, with a six-month price total return of -36.55%. This volatility is echoed in InvestingPro Tip #5, which notes the stock's considerable price fluctuations. Additionally, with a current price of $5.3 per share, Fat Brands is trading below the InvestingPro Fair Value estimate of $5.06, suggesting that the stock may be undervalued.
For investors intrigued by Mark Elenowitz's recent purchases and considering Fat Brands as a potential investment, there are 13 additional InvestingPro Tips available, offering further insights into the company's performance and investment potential. These tips can be accessed through the InvestingPro platform at https://www.investing.com/pro/FAT, providing a comprehensive analysis to support informed decision-making.
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