Executives, directors and members of the Koss family sold more than $44 million in stock in Koss Corp. over the past week as shares soared from the retail-investor buying frenzy.
Members of the Koss family, who own about 75% of the Milwaukee-based maker of headphones, sold $31 million of stock, according to filings with the Securities and Exchange Commission.
The filings suggest they sold at prices between $19 a share and $60 a share. The company’s shares were trading under $4 a share before it became popular with the retail trading crowd and soared to $64 a share on Friday.
The $31 million in sales is larger than the entire market value of the company — at about $26 million —before its share surge. The company’s current market cap more than $160 million.
Directors and other executives sold a total of $13 million in shares. When reached by CNBC, a company spokesperson declined to comment.
Koss has become a favorite of retail traders looking for “short-squeeze” opportunities beyond GameStop. The company’s stock had short interest of over 35% before its increase, putting it on many lists of most-heavily shorted stocks. By buying the shares, the traders hoped to force short-sellers to cover their positions at a loss and abandon the trades.
Yet the heavy sales by insiders, and the wealth they generated, suggests that in many cases, it is the big insiders and major shareholders who profited from the trades rather than the small retail investors.
Typically, when an investor shorts a stock, he or she borrows the shares with the belief its price will fall. Then, the investor can buy the stock at a profit.