Daily Archive

So Yea was right, again.

Yea, until last week the CEO of the UK venture capital group 3i (III, 219p), sold GBP 500,000 of shares back in July 2008 at 823.5p (see ‘3i- Hooray for Yea- now take profits‘-followthedirectors.co.uk July 23rd)

3i shares are now trading at 219p, a fall of 76%. The FTSE 100 index has fallen over the same period by 24%. In my calculations that means that 3i have underperformed the index by around 67% since July last year, when Yea sold his shares.

Last week 3i announced a new CEO, Michael Queen. Queens appointment was swiftly followed by a raft of directors purchases, which may have some significance (see below).

I’m always a little wary of these sort of directors dealings. Are they expressing their support for the incoming CEO, or do the directors think they can make money by buying shares ahead of significant cost cutting announcements or changes in strategy?

As a result of my concerns I’m only going to give these signals a MEDIUM rating, pending further director buying activity. But having said that, I’m happy to close my negative view on 3i, and to take some very nice profits.

View on 3i: POSITIVE

Strength of Signal: MEDIUM

For all posts on 3i click here.

Directors purchases (source London Stock Exchange):

Michael Queen, CEO, bought 100,000 shares at 216.6p, initiating a position. Jan 30th.

Willem Mesdag, Non exec, bought 25,000 at 210p, initiating a position (I estimate). Jan 29th.

Guy Zarzavatjian, PDMR, bought 305,000 at 210.7p, postion unknown. Jan 29th.

Lord Smith, Non exec, bought 5,000 shares at 213p, taking his holding to 9500 shares. Jan 29th.

Robert Swannell, Non exec, bought 4,000 shares at 210.3p, taking his holding to 17,000 shares. Jan 29th.

Baroness Hogg, Chairman, bought 5,000 shares at 213p, taking her holding to 5,000 shares. Jan 29th.