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Eric Daniels, CEO of Lloyds TSB Group (LLOY, 300p) has decided to step up to the plate by investing almost £300,000 of his own money in Lloyds shares.
Daniels on August 1st increased his position in Lloyds TSB by about 27% by buying 100,000 shares at 296.5p, taking his holding to 473,000 shares. For a great article on Daniels and Lloyds success in dire market circumstances read this article, published in the Telegraph today (link here).
Daniels colleague, Chairman Victor Blank, has invested roughly the same amount, buying 100,000 shares at 294p, increasing his position by 50% to 300,000 shares.
Despite Daniels making £2.7m a year (source : Daily Telegraph) I consider these moves to be significant, especially if Daniels is a ‘cautious’ individual. I would like to see more puchases, from Daniels and Blank, and hopefully other board members, to reinforce this signal.
At the moment the signal strength rates as MEDIUM.
Griffiths
Martin Griffiths, CFO of Stagecoach (SGC 275p) is taking his money off the table.
As at the beginning of June he held Executive Share Options over 479,000 shares, with varying exercise periods, starting in June and December 2006 and December 2007, and extending mostly to June 2010, with some as far out as December 2011 (Annual report).
Griffiths exercised all 479,000 between 26th of June and 8th July this year, which cost him £365k.
He sold all of them them on the same dates, realising £1379k, a net £1m in his pocket.
Why do I think this significant?
- He had another 2-3 years before he needed to exercise these options, but chose to exercise and sell now.
- This 479,000 shares is the total amount in his Executive Share Option pot*. Griffiths today owns less than 20,000 shares.
- When exercising options, directors usually sell sufficient to pay the tax man and hold on to the rest. Not in Griffiths case. He has exercised and sold the lot.
Griffiths behaviour and the subsequent risk profile of his remaining ‘Plan’ shares indicates to me that the risks to the Stagecoach shares outweigh the medium term returns. So I’d follow Griffiths and take some money off the table too.
*Griffiths also owns 166,000 in the Executive Pension Plan (vestable mid ’09 and mid ’10), and the equivalent of 675,000 in the Long Term Investment Plan, but these are subject to Total Shareholder Return criteria as detailed in the Annual Report, and designed to be taken in cash not shares, so you may not find out whether they have been exercised until the next Annual Report.
References:
Stagecoach Annual Report 2008, pp 35-38
On March 23rd (BXB A$9.63) I expressed intrigue that a director of Brambles (BXB, 380p), Craig van der Laan, should be selling. See ‘Brambles directors sale- economic slowdown starting to hit?’.
On April 18th (BXB A$9.03) Brambles shares ‘slump’ by 10% after an admission that the supply agreement with Walmart was under review (see Bloomberg news here).
Today (June 2nd) (BXB A$8.10) Brambles declare that van der Laan (Group President of CHEP Asia Pacific) has been selling more shares. Over 26th and 30th May he sold 255,000 shares (in his wifes name) to reduce his holding even further, to 368,000 shares.
June 24th (BXB A$ ??) – Brambles have a scheduled ‘Trading update’. We should expect to be updated on the ‘Walmart contract’. I wonder if van der Laan has any insight into what Brambles will tell us ?
Despite warning that 2008 will be a difficult year (see Scotsman article of May 9th here), BPI or British Polyethylene (BPI, 242p) Chairman Cameron McLatchie continues to buy.
His major issues are weak sterling and rising oil prices (see BPI website for full statement). Maybe he believes BPI can cover some of this increased cost through ongoing cost cutting.
I give him credit for having sold within a whisker of the high of BPI, selling 300,000 shares at 637p in March and April 2006. The shares reached a high of 715p. And recently reached a low of 227p.
McLatchie has bought over March and May this year so far a total of 150,000 shares at between 235p and 238p, taking his holding back up to 462,000 shares.
This will no doubt be a long term investment for him, and for me if I choose to follow him. And possibly pretty volatile too as I haven’t a clue where oil prices are going, do you?
On April 3rd I highlighted Mr Walshes last sale of Diageo (DGE, 1047p) shares (see commentary here).
I was particularly impressed with the fortuitous timing that Mr Walsh seemed to have shown with his previous share disposals.
Since April 3rd, Diageo shares are down 1% absolute, or down 6% relative to the FTSE.
I see no reason that May 9ths sale by Paul Walsh of 125,000 shares at 1040p shouldn’t be a continuation of either his good luck or expert timing.
On February 28th I highlighted significant buying activity by the COO, CFO and CEO of Robert Walters (RWA, 165p) (see comment here). At times the shares have been decent performers, but have now drifted back below the FTSE 250 performance since Feb 28th.
We did see however a non exec, Martin Griffiths, last week buying 12,000 shares at 167p.
Peanuts in terms of ££ compared to the guys above, however Griffiths’ purchase takes the number of directors buying to four out of eight.
I don’t expect any near term news, but note that Robert Walters has been the subject of bid rumours in the past. One to watch.
I see Paul Walsh, CEO of Diageo (DGE 1055p) has sold just under a million pounds of shares, resulting from an options exercise the same day.
Looking back, he always sells pretty much all the shares he receives as a result of exercising his options, not just a portion sufficient to pay the tax, so behaviourally this is no change from previous sales.
What I did notice though is that he has been very clever at hitting all the peaks in the Diageo share price chart over the last two years.
To best see this, go to digitallook.com, search for diageo, draw a chart, and overlay directors dealings.
The chances are that he’s done it again this time, and 1055p may well be the recent peak of Diageo for a few months.
followthedirectors... a study of directors share dealings 