Let’s play a game of “Guess That Billionaire.” Here’s the setup: A CEO wakes up one day, looks at his company’s stock, and decides, “Screw it, I’m buying.” Not just a little… $2.69 billion worth.

If you guessed Jeffrey Walker, CEO and 10% owner of Alliance Entertainment Holding Corp, congrats… you win absolutely nothing. But hey, knowledge is power.

According to a recent SEC filing, Walker increased his direct stake in the company to 23,005,262 shares… a nice little nest egg (if you ask me).

Why drop two and a half SpaceX rockets’ worth of cash on your own stock? Either Walker really, really believes in the future of Alliance Entertainment… or he lost a bet and had to make the most expensive dare in history.

If you’re thinking, This company must be absolutely killing it, well… sort of. On one hand, Alliance Entertainment recently reported a revenue dip in Q2 FY2025… down to $393.7 million from $425.6 million the year before (not great). Their net income is also down $7.1 million vs. $8.9 million in 2024 and adjusted EBITDA dropped to $16.1 million from $17.9 million (also not great).

However, not all areas of the business are struggling. Vinyl sales increased by 12%, proving that demand for physical records continues to grow, particularly among younger consumers. Physical movie sales also saw a surprising 23% increase, indicating that the demand for DVDs and Blu-rays hasn’t completely disappeared despite the dominance of streaming services. Another notable shift in the company’s revenue stream is its direct-to-consumer business, which now accounts for 42% of total revenue, showing a strategic push toward a more profitable retail model.

Walker is also making moves outside the stock market. Alliance Entertainment recently inked a distribution deal with Paramount, which could give its financials a much-needed protein shake. They also snatched up Handmade by Robots, a brand that sells collectible figurines. (Fun fact: Handmade by Robots is not actually handmade… or by robots. It’s just a catchy name.)

Plus, in addition to hoarding stock… he also picked up warrants on 28,476 and 52,500 shares, priced between $0.2292 and $0.30 per warrant. This suggests he’s planning to hold for the long term.

Right now, analysts are giving Alliance Entertainment that look like “Alright, what’s the catch?” The stock has soared 194% in the last six months. It is currently trading at a price-to-earnings (P/E) ratio of 32.00, which, while higher than its 12-month average of 13.55, still suggests a level of confidence in its future growth potential. The significant increase in its P/E ratio (up 136% over the past year) indicates that investors are pricing in expectations of higher earnings ahead (whether it actually happens is another story).

No major analyst upgrades or downgrades have come through yet, but with Walker throwing around billions like it’s lunch money, you can bet institutions are watching closely.

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Stocks.News has a position in Alliance Entertainment mentioned in article.