Jonathan Segal, a director and significant shareholder of ONE Group Hospitality, Inc. (NASDAQ:STKS), recently acquired 8,000 shares of the company's common stock. The shares were purchased at a weighted average price of $3.08 per share, totaling approximately $24,640. This transaction took place on November 12, 2024, according to the latest SEC filing.
The purchase increases Segal's direct ownership of ONE Group Hospitality shares to 3,145,074 shares. The filing also noted a separate transaction where 500,000 shares were disposed of, but this was reported at no cost, reflecting a non-monetary transaction.
ONE Group Hospitality, known for its upscale restaurant brands, continues to see active trading by its insiders, which is often closely watched by investors.
In other recent news, The ONE Group reported a substantial 152% increase in their Q3 2024 revenues, reaching a record $194 million. This surge is largely credited to the successful acquisitions of Benihana and RA Sushi, which brought in $119.4 million. Despite a decrease in comparable sales, the company managed a restaurant operating profit margin of 13.2%. These recent developments also include the return of $2.3 million to shareholders via share repurchases.
The ONE Group is on track toward its goal of $5 billion in system-wide sales, underpinned by a focus on balance sheet flexibility and shareholder value. The company has also revised its 2024 revenue targets to between $660 million and $680 million. However, a decline in same-store sales of between 4% and 8% is expected for Q4 2024.
The company plans to open six new venues by the end of 2024, with a keen focus on enhancing customer loyalty. They are also exploring franchising opportunities and management contracts as part of their asset-light growth strategy. For 2025, The ONE Group projects consolidated margins of around 17%, with potential growth to 18%.
InvestingPro Insights
Jonathan Segal's recent purchase of ONE Group Hospitality (NASDAQ:STKS) shares comes at a time when the company's stock is trading near its 52-week low, according to InvestingPro data. This insider buying activity could be seen as a vote of confidence in the company's future prospects, despite recent challenges.
InvestingPro Tips reveal that STKS is expected to see growth in both net income and sales in the current year, which may have influenced Segal's decision to increase his stake. However, the company is also operating with a significant debt burden and is quickly burning through cash, which could pose risks to its financial stability.
The company's revenue growth has been impressive, with InvestingPro data showing a 63.49% increase in the last twelve months as of Q3 2024. This strong top-line performance is further emphasized by a remarkable 152.3% quarterly revenue growth in Q3 2024. Despite this growth, STKS is currently not profitable over the last twelve months, although analysts predict profitability for the current year.
It's worth noting that STKS's stock price has experienced significant volatility, with a 47.63% decline over the past six months. This decline has brought the stock's price to just 46.2% of its 52-week high, potentially presenting a buying opportunity for those who share Segal's apparent optimism.
For investors seeking a more comprehensive analysis, InvestingPro offers 16 additional tips for STKS, providing a deeper understanding of the company's financial health and market position.
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