Jumbo Interactive CEO is in the money after massive director trade
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Shares in online lottery business Jumbo Interactive (ASX:JIN) have been on a tear since February after it revealed a jump in half year winnings, and that rise has help boss Mike Veverka to make even more of a killing on options than usual.
Veverka has been converting his huge pile of minimally priced options in the company into stock since September last year, and selling.
Options give a person a right to buy a stock at a specified price, and are often issued to directors as an incentive to work harder and, therefore, get the stock price up.
An option is ‘in the money’ if the conversion price is lower than the market price of the share, as it is with Jumbo. The idea is to convert the option, sell the stock on market, and pocket the difference.
A director’s trading note today revealed Veverka made $2.2m this week by doing exactly that.
He converted 250,000 options at $3.50 each and sold 185,084 at $16.60 each, for a total of $3.1m.
Over eight trades Veverka has made $17.7m profit, at a cost of $6.3m.
Jumbo provides people with a simple platform to try to hit its digital lottery jackpots.
It said in February the half year profit beat guidance and 140 per cent higher than the same period in the year before, at $12.7m.
It is forecasting full year profit to come in at $24.2 million, an increase of more than 100 per cent from the prior year.