Two top-ranking executives at Caesars Entertainment (ticker: CZR) snapped up shares of the gambling company days after it triggered a slide in the stock by offering a disappointing outlook for third-quarter operations on the Las Vegas Strip, according to filings with the Securities and Exchange Commission.
The stock fell to a 52-week intraday low of $8.55 on Aug. 1 after management provided the outlook, even though the company also reported upbeat second-quarter earnings. JPMorgan analyst Daniel Politzer attributed the decline "to concerns over guidance/forecasting, credibility, and fear that we could be entering a period of pricing pressure on the Strip (with the leisure segment particularly susceptible) that could be specific to CZR and/or the LV Strip."
Caesars Chief Executive and President Mark P. Frissora leapt into action on Aug. 3 as the weakness continued. He bought 100,000 shares for $955,000 that day, paying $9.55 each on average. It was the biggest open-market purchase of the company's shares by an insider since Frissora bought 100,000 shares on May 21, 2015. He now owns 2 million shares directly, including unvested restricted stock units, 595,300 shares through a trust, and 1,900 shares through a daughter.
Chief Financial Officer Eric Hession also scooped up stock on Aug. 3, making his first open-market purchase since being named to the post in 2014. Hession bought 10,000 Caesars shares for $95,400, an average of $9.54 each. He now owns 607,250 shares, including unvested restricted stock units.
Caesars declined to comment on the transactions.