Red, Red, Wine Insider Buy

Insider buying slammed on the brakes last week. It might be the lightest roster of buying we’ve seen in the last year, maybe longer. We aren’t sure if it means anything, but the slowdown coincided with the NASDAQ moving into an OVERBOUGHT reading according to its Relative Strength Index (RSI) topping 70. Maybe insiders are concerned about the index topping out and on the edge of a selloff.

Despite limited options on last week’s short list of purchases, we did find one insider who has nearly a perfect record of being on the right side of the trade for the last 19 years.

Willamette Valley Vineyards, Inc. (WVVI) Founder, President and Board Chairman, James Bernau first bought WVVI shares in May 2004. It was a small buy, just 1,405 shares at $2.49 for a total investment of $3,498. It would start a series of trades where the Chairman bought low and sold higher for nearly 20 years. (1)

Five months after the small buy, Bernau sold 31 straight times from $2.99 to as much as $8.48. The last of the 31 sells was in June 2008. He switched sides in April 2009 and bought again. This time, he acquired 6,942 shares at $2.60 for a total of $18,047. He didn’t act again until June 2016, when he unloaded 12,000 shares at $8.60, collecting $103,233.  All told, the founder hit the sell button uninterrupted 24 times through April 2019.  He put his buying hat back on twice in January 2021 at $6.33 and $6.73 and once more in early February at $7. Three months later, the seller came out again. This time he sold five times between May and October 2021 from $12.75 to as high as $14.

With a record like that, investors should know Bernau is back on the buy wagon, acquiring 6,700 shares at $5.85 on June 16, and investment of $39,195. While the amount is relatively small by our insider buying standards, his track record stands tall.

Bernau formed Willamette Valley Vineyards in May 1988 to produce and sell premium, super premium, and ultra-premium varietals. The Company’s wines are made from grapes grown in vineyards owned, leased, or contracted by the Company, and from grapes purchased from other vineyards. The grapes are harvested, fermented, and made into wine primarily at the Company’s winery in Turner, Oregon.

The wines are sold principally under the Company’s Willamette Valley Vineyards label, but also under the Domaine Willamette, Griffin Creek, Tualatin Estate, Pambrun, Maison Bleue, Natoma, Metis, Pere Ami and Elton labels. The Company also owns the Tualatin Estate Vineyards and Winery, located near Forest Grove, Oregon.

WVVI is lightly traded, averaging 24,896 shares a day (2) and doesn’t have Wall Street coverage or earnings or sales estimate. Investors need to look elsewhere for industry trends.

According to Statista: (3)

  • Revenue in the Wine market amounts to US$56.65bn in 2023. The market is expected to grow annually by 5.85% (CAGR 2023-2027).
  • In global comparison, most revenue is generated in the United States (US$56,650.00m in 2023).
  • In relation to total population figures, per person revenues of US$168.30 are generated in 2023.

OVERALL: President and Willamette Valley Vineyards, Inc. (WVVI) founder, James Bernau’s record of being on the right side of the trade is impeccable. However, without Wall Street support and thin volume, WVVI shares could be subject to wild swings.

WVVI is only appropriate for the most aggressive investors with a time horizon of at least two years.


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