Eaga (EAGA, 112.5p), the UK heating system provider for social housing, has announced that the CEO and CFO are each selling 1.1m shares ‘to satisfy tax liabilities incurred at IPO which are due shortly, ……..and to provide an element of liquidity‘ (Company statement November 25th, source London Stock Exchange).

In April eaga directors bought shares, taking advantage of a depressed share price resulting from costs concerns primarily related to copper prices. This prompted us to look at eagas valuation, and its comparison with Connaught (CNT, 366p), a similar company, where directors had been selling shares.

Since April 30th ‘Connaught (directors selling) vs Eaga (directors buying)‘ Eaga are down 13.5%, the FTSE 250 index is down by over 40%, and Connaught are down 8.67%.

If the CEO and CFO are selling shares, then maybe we should also.

So we close our positive view on eaga with a 27% relative performance vs the FTSE 250, and a -5% relative performance vs Connaught.

View on eaga- Negative – directors selling shares.

Strength of signal- Medium

For all followthedirectors comments on eaga click here.

Share transactions:

John Clough CEO sold 1.1m shares at 110p taking his holding to 5.236m shares.

Ian McLeod CFO sold 1.1m shares at 110p taking his holding to 3.982m shares.