Shares of Chewy (NASDAQ:CHWY) are in the spotlight following an insider purchase from Director James Star. In fact, Star is the only insider to have purchased shares of CHWY stock this year.
Chewy has not had a pleasant year. Shares of the online pet supplies retailer are down more than 50% year-to-date as consumers return to in-person shopping. During the early days of the coronavirus pandemic, shares of the company soared as high as $118. Today, the stock trades just under $30.
This morning, Chewy was a top trending ticker on Twitter (NYSE:TWTR). The company is known for its outstanding customer service and attention to details. For example, a Twitter user noted their dog had passed away recently. In response, Chewy sent the owner a hand-painted portrait of the dog. This is not the first instance of Chewy doing kind deeds like this, as the company has been praised for sending flowers to grieving pet owners as well.
Meanwhile, Star seems to believe the price of Chewy has fallen too far, as he has purchased almost $10 million of CHWY stock this month. Let’s get into the details.
Director James Star Buys CHWY Stock
On June 13, Director James Star purchased 181,478 shares of CHWY stock at average prices ranging between $26.91 and $27.48. The shares were purchased indirectly through Downstream Partners, of which Star has an indirect interest through a family trust. Downstream operates as a business consulting services company.
A week earlier, the director purchased 180,636 shares at an average price of $27.70. Of the 180,636 shares, 36,127 shares were purchased directly by Star. The remaining shares were purchased through Downstream Partners.
In total, the two transactions amounted to a whopping $9.98 million. After the purchases, Star directly owns 110,949 shares of common stock and vested restricted stock units (RSUs). He also owns 1,624 RSUs as compensation for being a director. Meanwhile, he indirectly owns 325,987 shares through Downstream.
Besides Star, the last insider transaction was attributable to Principal Account Officer Stacy Bowman on December 29. Bowman sold 11,252 shares at average prices ranging between $57.69 and $59.45.
Star’s direct and indirect purchases are a signal of his conviction in Chewy. In December 2021, Star was selling shares in the $85 to $100 range. With CHWY stock now trading at a massive discount to his past sales, it appears Star now finds the valuation of his company to be attractive.
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.