Recent insider trends for Entercom Communications Corp. (NYSE:ETM) have caught the attention of investors. Insider activity is often a strong indicator of future performance in a stock, and if the data on ETM is anything to go by, investors should pay attention.
Institutions own 77.10% of Entercom Communications Corp. (ETM)’s shares. The total value of these holdings, in millions, is $270. Among active positions in the latest quarter, 64 holders increased their positions by a total of 7.37 million shares, 47 holders decreased the positions by a total of 2.85 million shares, and 20 holders held their positions. This works out to a net increase in ownership of 4.52 million shares, and suggests that institutions are feeling bullish about the stock.
Among new and sold out positions, 30 holders initiated new positions by a total of 5.61 million shares and 22 holders exited their positions by a total of 1.24 million shares. This nets out to an increase of 4.37 million shares and is a bullish sign for ETM.
Insider ownership increased by a total of 0 shares, which suggests that ETM’s key executives are feeling more optimistic about the outlook for the stock. The data from the past twelve months tells a similar story: insiders executed 24 buys and 38 sells, and ownership increased by a net of 150248 shares.
Short interest is another tool that analysts use to gauge investor sentiment. It represents the number of a stock’s shares that are being shorted by investors. Entercom Communications Corp. (NYSE:ETM)’s short interest is 16.8 million shares, or 77.44% of the float. This represents an increase of 55% in the number of shares being shorted compared to the previous reading, and implies that investors felt more pessimistic about the stock during the past two weeks.
Insider data can help an investor form an outlook on a stock, but it’s important to supplement this data with other information such as technical indicators to form a more complete view. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that ETM is a Weak sell, which implies that ETM is expected to underperform the market based on prior trading patterns.
Institutional ownership trends suggest that the stock is cheap and the insider trading data indicates that insiders are bullish. Technical indicators (also) suggest that Entercom Communications Corp. (NYSE:ETM) is overvalued.