Movie stars get paid millions. So, too, it seems do film distributors. Chief executive Darren Throop and Patrice Theroux, who heads up the film division, have made a fortune running Entertainment One (ETO) - the company behind Peppa Pig. They have now sold shares worth almost £4.3m since the selling began a few weeks ago, only six months after joining finance boss Giles Willits in offloading a total of 2m at 191p.
Incredibly, Mr Theroux's latest clearout is not over. He's already sold a £1.36m stake, but admitted in a statement that he would sell 1.5m shares this time. That leaves £1.2m of shares still to go and an obvious stock overhang. We do, however, have it on good authority that there is nothing sinister behind the disposals. Certainly, last month's half-year results were strong. Pro forma underlying cash profit jumped 43 per cent and further savings from the Alliance Films acquisition should feed through over the next few months.
Investec Securities expects adjusted EPS to grow 25 per cent in the year to end-March 2014 and by 11 per cent the year after. It's likely the company will pay a first full-year dividend, too - good news for Mr Throop and Mr Theroux who still own over £29m of shares between them. At 240p, up five-fold since we said buy (39p, 20 November 2009), the shares trade on little over 12 times earnings. This story isn't over. Buy.