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Directors Dealings – why I believe in them
September 22, 2007 in Uncategorized | Tags: directors, directors buys, directors dealings, directors share dealings, insiders, UK stockmarket | Leave a comment
Over the years I have met with senior management of hundreds of UK and European companies. I found managements’ body language and what companies didn’t say to investors to be far more valuable than what they did say, and I learnt to take the corporate spiel with a large pinch of salt.
Directors personal share dealings cut through the talk. I see them as a sign of what management really think of the opportunities and risks their company faces, as well as the current and potential company valuation.
In looking at directors dealings I ignore all the ‘incentive plan’ deals, where the company matches what you buy. Why wouldn’t you buy stock if you’re getting it half price? I ignore all the options exercising too, as this is usually seen by directors as pay which needs to be turned into cash.
Anything I write here is my personal opinion, and is not a recommendation to buy or sell shares, just my commentary on activity in the market.