This FTSE 100 stock has fallen 50% and directors are loading up on shares

FTSE 100 stock Rightmove (LSE: RMV) has taken a massive hit recently. Since last August, it has fallen around 50%.

What’s interesting is that company directors are taking advantage of the share price weakness and buying shares. This suggests that these ‘insiders’ – who will have more information on their company than the rest of us do – see a compelling investment opportunity right now.

Director dealing at Rightmove

Since late February, four different directors at Rightmove have bought stock. The most recent purchases have come from Chair Andrew Fisher, who snapped up about £85,000 worth of shares in late March while the share price was near £4.20.

Before this, both the CEO and the CFO bought shares in mid-March when the share price was near £4.60. Obviously, it’s notable that top-level management has been buying, however, I’ll point out that these trades were relatively small – between the two insiders they only bought around £30k worth of stock.

The final trade I want to highlight isn’t small though. In fact, it’s huge.

It came from board member Lorna Tilbian and was worth about £993,000. She bought 220,273 shares at a price of £4.82 on 27 February.

This trade is really interesting. Because Tilbian has significant investment experience.

She was a founder of stockbroker Numis Corp (now Deutsche Numis). She was also Head of the Media Sector in Corporate Broking & Advisory at the firm until September 2017 so she is likely to know Rightmove very well.

An investment opportunity?

So, could there be an opportunity here for the rest of us? Potentially – I believe Rightmove shares are worth a closer look right now.

This stock has been absolutely hammered amid the software sell-off. Clearly, a lot of people believe this company’s offering is going to be obsolete in the AI era.

I’m not convinced though. The beauty of Rightmove is that it brings together a ton of different properties in one place making it easy for potential buyers or renters to browse what’s on the market.

Meanwhile, it’s developing its own AI features to compete with platforms such as ChatGPT. Not only has it released a powerful new search tool (trained on 25 years of data) but it has also released a ‘style with AI’ feature that allows users to visualise properties in different ways.

As for the valuation, the stock is looking very cheap after its 50% fall. Looking at earnings forecasts for 2025, the forward-looking price-to-earnings (P/E) ratio is only 13.

Note that the dividend yield is now close to 3%. So, not only do we have value on offer but we also have income.

Of course, AI is a risk to internet companies like this. Perhaps people will stop using platforms like Rightmove and instead do everything through ChatGPT or with AI agents?

Ultimately, there’s some uncertainty today. We don’t know how this will all play out.

With the stock down 50% and now offering a near-3% yield though, I think it’s worthy of further research. Insiders certainly seem to be bullish.