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Wolfson- now four directors are buying
May 12, 2008 in Directors buying, FTSE Small Cap, STRONG signal | Tags: Wolfson | Leave a comment
Way back in December I pointed to ‘wise man’ Carey buying into Wolfson (WLF, 137p) shares (see note of December 21st ‘Wise of Wolfson buys back 58% cheaper‘ here).
But the shares continued to drift as Carey bought at lower and lower prices. Then the news that Wolfsons contract with Apple had not been renewed (see Times comment here) caused a 30% drop in the share price. Wolfson hit a low of 99p, and my jaw hit the floor too!.
But over the last two months Carey has been joined in his enthusiasm for Wolfson shares by three other non execs:
19th March Rob Eckelmann buys 7500 shares at 128p. He now owns 30,000 shares.
25th April Barry Rose buys 15,000 shares at 136p. He now owns 38,000 shares, and on
1st and 8th of May Michael Ruetggers, the non exec Chairman of Wolfson, buys 200,000 shares at 140p. He now owns 300,000 shares.
I am happier seeing four directors of Wolfson buying shares than one director. I take their mutual enthusiasm for Wolfson as a very positive (long term) sign.
Smith and Nephew – COO and Chairman increase holdings marginally
May 9, 2008 in Directors buying, FTSE 100, WEAK signal | Leave a comment
There is not a lot to add on Smith and Nephew (SN. 552p).
Poor results due to problems integrating a recent acquisition, as well as questionmarks over accounting of sales at the acquisition, resulted in a 14% drop in share price on May 1st.
John Buchanan (Chairman) bought 35,000 shares at 568p on May 2nd.
David Illingworth (Chief Operating Officer) bought 13,500 shares at 572p on the same day.
These are credible, but not strong, signals. Buchanan increased his position by around 25% and Illingworth by 15%. I’d prefer to see more buying by these two, or by other board directors, before following them in myself.
ITE corp- Chairman buying, Interim results May 19
May 9, 2008 in Directors buying, FTSE 250 company, WEAK signal | Tags: ITE Group PLC | Leave a comment
Iain Paterson, the non exec Chairman of ITE Group PLC (ITE, 150p) in March sold nearly all his share 243,000, at 141p (would this be for tax reasons?).
He has now started to buy them back, investing £71k on May 1st (bought 50,000 shares at 142.5p) and £74k on May 6th (50,000 shares at 148.3p). He now owns 148,000 shares.
ITE is an organiser of trade exhibitions and conferences. Think Russia, Oil, Gas – all highly cashed up growth areas. So do you expect a good set of interim results on May 19th? I bet Paterson does.
Connaught (directors selling) vs eaga (directors buying)
April 30, 2008 in Directors buying, Directors selling, FTSE 250 company, STRONG signal | Tags: Connaught, eaga | 3 comments
I commented the other day that I believed eaga (EAGA, 124p) to be unloved, unknown and out of favour, but with directors buying prompting a ‘look again’ signal for investors (see post here).
Then I see that two days ago, Mark Tincknell, the Executive Chairman of Connaught (CNT, 396p) had been selling down his position in his company. He has sold 2 1/4 million shares, almost a third of his position, at 375p, to leave him with 1.3 million shares.
There are a couple of quotes I find rather amusing in the press release, namely that he sold shares ‘to satisfy institutional demand’‘. Well somebody had to be on the other side of the trade didn’t they !!
And then the release goes on to state that Mr Tincknell is ‘extremely positive about the future prospects of the company’. That may well be the case. But the fact that he is selling such a huge slug of his holding may also indicate that Mr Tincknell thinks that those future prospects are already discounted in the share price.
I know little of these companies save what I read on their websites. These lines are taken from their company overview pages:
Connaught: ‘Our Social Housing division has a community focus, fixing, maintaining and cleaning homes and neighbourhoods for local authorities and social landlords, and is one of the most highly respected players in the national social housing landscape. Our Compliance division specialises in gas, electric, water and fire compliance, and provides full health and safety and business risk assessments.’
eaga: ‘A leading provider of residential energy efficiency measures for utility companies under the Energy Efficiency Commitment (EEC), and a large and rapidly growing supplier into the social housing sector.’
I see a similarity in customer bases, but with a slightly differing product.
Then I look at the financial data as provided by Digitallook.com.
Company: …………………………………………Connaught ……………eaga
Mkt cap £m ………………………………………485 ……………………..306
Turnover £m ……………………………………..400 …………………….482 (both last reported finl year)
Net cash flow from operating activities £m 9.75 …………………33 (both last reported finl year)
Share price ………………………………………. 396p …………………..124p
eps (last reported finl year/forecast) … 12.2p/17p ……………12.27p/10.6p
And I leave you to make your own conclusions. All I can add is that this would be a long term trade, as it will take 2+ sets of results by eaga to change investors opinions.
Housebuilding at a standstill, but Galiform directors buying
April 25, 2008 in Directors buying, WEAK signal | Tags: galiform, housebuilders | 1 comment
I’m intrigued.
Galiform (GFRM, 71p) own Howdens Joinery, which supplies kitchens and joinery products to the building trade.
In a week of turmoil in the UK housebuilding industry prompted by Persimmon warning they would stop building new homes, I find that the CFO of Galiform, Mark Robson, makes his first purchase of shares since he joined the board in 2005.
Robson on April 15th bought 132,000 shares at 77 1/2 p, investing £102,000.
As a result Galiform goes on the watch list.
Addendum May 1st : I’m no longer intrigued. Stock is up 7% today on results better than the market anticipated. See reuters comment here.
eaga – directors buying again
April 25, 2008 in Directors buying, FTSE 250 company, STRONG signal | Tags: eaga | 1 comment
eaga (EAGA, 135p) is a little understood company. It is more than 51% owned by its employees and directors, is trading below it’s IPO price of 181p, and its activities encompass something investors have little experience in, namely working with social housing providers and utilities in the replacement of heating systems.
The shares recently ‘collapsed’ from 200p at the end of February, to 135p now, on the back of an interim report pointing to cost squeezes and demand delays.
In January all the executive directors bought stock, at around 150p. I ignored this signal because the size of the purchases relative to the existing holdings were at 1% irrelevant.
But Malcolm Simpson, a non executive director of eaga, then increased his holding by 45%, investing £38,000. Last week he invested a further £40,000 by buying 30,000 shares at 133p, taking him to 88,000 shares.
And this week Dave Routledge, an Executive Director, has invested £99,000, buying 75,000 shares at 132p. In the context of Mr Routledges pay (£231,000- source: annual report 2007), his investment of £200,000 since January should be seen as significant.
I believe that eaga shares are underheld and the company unknown by UK investment institutions, and that therefore the information on directors dealings as highlighted above is significant.
Also see April 30th post on eaga and Connaught here.
AMEC – a difference of opinion? CEO buys shares, CFO sells
April 25, 2008 in Directors buying, FTSE 100, STRONG signal | Tags: AMEC, insiders | 1 comment
I’m back from a weeks camping holiday with the family to find a whole load of share dealings by UK directors, but nothing hugely inspiring. Most of the ‘regulatory news reports’ issued by companies relate to directors exercising options granted as part of their pay, and selling sufficient shares to raise cash with which to pay the tax man.
In the case of AMEC (AMEC, 752p) I find that CFO Stuart Siddall exercised options on 200,000 shares, and sold them all (April 4th 2008). He has done this before, so this isn’t a change in behaviour. He owns now only 30,000 shares in AMEC, maybe more if you count share awards in the pipeline as options still to be exercised and realised. Maybe he is just a conservative investor.
Now lets look at Samir Brikho, appointed CEO in October 2006. He has about 1m shares in the pipeline, in the ‘Performance Share Plan 2006 and 2002’. Yet he has been buying more. On the 7th April he bought 16,000 shares at 718p, and on the 24th April 50,000 shares at 742p, taking him to 182,000 shares (excluding the unexercised options or shares mentioned above).
Is this significant? I’d say yes. Brikho has spent £483,000 and increased his position in AMEC by 50%.
The caveat on this call is that I don’t have a share transaction track record to look back at, and also that share ownership by the directors of AMEC is currently pretty limited in the number of directors (only 3). But I suspect that is about to change.
Update: Severfield Rowen (directors share sale) and Enodis (bid approach)
April 10, 2008 in Directors buying, FTSE 250 company, FTSE Small Cap | Tags: Enodis | Leave a comment
This is an update on two strong calls.
‘Strong’ because of the extent (number of directors) and size (as % of previously held positions) of director buying.
Severfield Rowen (SFR, 331p) have announced that John Featherstone, a non exec director, has sold almost all his shares, realising £387,000.
This in itself is not a strong sell call, but may signal an opportunity to take profits. SFR are up 26% absolute, and up 25% relative to the FTSE 250 since the original buy signal on January 31st (see the post here).
Enodis (ENO, 224p) yesterday announced an approach from Manitowoc (MTW), possibly as high as 260p (see news here) . In November senior directors bought shares between 166p and 186p. See original post of December 2nd here. Since then Enodis are up 30% absolute, or up 37% relative to the FTSE250.
Severfield Rowen
April 3, 2008 in Directors buying, FTSE Small Cap, STRONG signal | Tags: Severfield | Leave a comment
Since six directors of Severfield Rowen (SFR, 320p) piled into the stock in January taking advantage of a collapse in the share price, the stock is up 30% both on an absolute basis, and against the FTSE Small Cap index.
Results yesterday (see Tempus comment here), accompanied by more director buying, have sent the stock higher again today. Non exec David Ridley bought 20,000 shares yesterday at 306p, taking his holding to 72,000 shares.
The purpose of this post is to remind you of the strength of the signal that the directors sent to the market back in January (see post here), so that next time it happens both you and I will pay closer attention.
6 directors (out of a board of 11) had increased their holdings by between 50% and 200%!!
mmmmmm Misys – ‘Turnaround Strategy’ working?
March 31, 2008 in Directors buying, FTSE 250 company, MEDIUM signal | Tags: Misys | 2 comments
Misys'(MSY. 137p) CEO, CFO and Chairman have increased their positions by between 14%, 50% and 60% respectively, buying shares at between 135p and 136p last Friday.
Results imminent? No. We had an interim update (upbeat) and a share placing (at 175p) on the 18th March.
Track record? No. Management have been buying shares down from 248 to present levels since last year.
So why look at Misys?
1. Significant increase in positions (50-60%)
2. Three senior bods buying £70-£135k of shares each
3. Misys is one year into ‘Turnaround Strategy’, which should go some way to insulating them from the expected downturn in demand from banking customers.
So one for the watchlist, or for the long term investors.
See subsequent post of July 30th- ‘Misys- directors continue to buy- in size’.
followthedirectors... a study of directors share dealings 