Is New Age Beverages Corporation (NBEV) Soaring Insider Trading Sending a Signal?

The exact reason why investors have been taking up New Age Beverages Corporation (NASDAQ:NBEV) stock at a frenetic pace might seem like a bit of a head-scratcher at the moment, but that’s only if you are buying the stock for the wrong reasons. On 06 December, the shares accumulated 0.2 points or 4.37 percent at $4.78 with a light trade volume of 8.093 million shares. After opening the session at $4.26, the shares went as high as $4.85 and as low as $4.15, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $332 million and now has 69.52 million shares outstanding. New Age Beverages Corporation (NBEV) stock has gained 8.88 percent of market value in 21 trading days.

NBEV stock has a trailing 3-year beta of 3.54, offering the possibility of a higher rate of return, but also posing more risk. The portion of a company’s profit allocated to each outstanding share of common stock was -$0.39 a share in the trailing twelve months. The stock’s value has surged 120.28 percent year to date (YTD) against a rise of 120.28 percent in 12 month’s time. The company’s shares still trade -52.15 percent away from its 1-year high of $9.99 and 267.69 percent up from 52-week low of $1.30. The average consensus rating on the company is 2.3, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a sell.

New Age Beverages Corporation (NBEV) will probably climb 4.6 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $11-month high price target. This represents a whopping 130.13 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $6, which represents a return potential of 25.52 percent when compared to the closing price of the stock of $4.78 on Thursday, December 06. The lowest price target for the stock is $4 — slightly more than -16.32 percent from NBEV’s current share price.

History has shown that shares in New Age Beverages Corporation have gone down on 4 different earnings reaction days and are predicted to add 0.08 percent when the company reports upcoming earnings.

Let’s take a look at some insider activity at New Age Beverages Corporation (NASDAQ:NBEV) and see the pattern. The earliest insider trade took place on 08/24/2018. Brennan Ed gathered a total of 1.2 million shares of company at average share price of $1.3. The total for the purchase was set at $1.55 million. After this transaction, the Director account balance stood at 1.23 million shares. The stock grew 267.69 percent since that insider purchase. On 08/24/2018, Fea Gregory, Director, purchased 39 thousand shares at a price per share of $1.28. This added 49.92 thousand shares to the insider’s fortune and the stock saw a 273.44 percent rally in value since the news became public. This transaction left 69.23 thousand shares in the Director account.

On 08/24/2018, CEO Willis Brent D performed a purchase transaction worth $99.84 thousand. This purchase at $1.28 each has added 78 thousand shares into the insider’s portfolio position. Meanwhile, shares have recorded 273.44 percent increase since the transaction was reported. The insider now is left with 1.93 million shares remaining in the account. Evans Robert J., who performs the Director job, bought 100 thousand shares for $128 thousand. The acquisition occurred on 08/24/2018 was priced at $1.28 per share. The share price soared 273.44 percent since the reporting date. Evans Robert J. now left with a stake of 162.19 thousand NBEV stock worth $775.27 thousand after the insider buying.

The stock is currently hovering around the first support level of $4.34. Below this, the next support is placed in the zone of $3.89. Till the time, the NBEV stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 51.78 on daily chart, which may remain a cause for concern. If the price breaks below $3.89 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $5.04 mark may result into a pull-back move towards $5.29 level.

Further, it is sporting a 6.73 on the Price-to-Sales ratio. Compare this with the industry average P/S of 20.13. 17.6 percent is the gross profit margin for New Age Beverages Corporation and operating margin sits at -28.4 percent. Along with this, the net profit margin is -29.1 percent.