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Brambles Ld (BXB, 424p) has a secondary listing in London, and a primary listing in Sydney. I noticed a director selling £702k of shares, way down from the high, and wonder if this is a result of a slowdown in revenue at the group.
Brambles directors have been buying through 2006 and 2007, at prices between 506p and 557p in 10s and 20s (thousands of shares). The stock peaked in October 2007 at 650p. Then, last week, Craig van der laan de Vries, ‘Group President of CHEP Asia Pacific’ sells almost 20% of his holding, 160,000 shares at 440p, raising £702,000.
What does he know that we don’t know? Hazard a good guess.
With 83% of Brambles revenues from CHEP, the global ‘bluepallets’ people, with sales split 44% Americas, 43% Europe, and 13% Rest of World, these guys have significant exposure to a slowing economy.
But then there could be 4% of the company coming to market pretty soon (see smh comment here).
The last news release was the interim results on Feb 21st, so don’t expect anything soon. But still I do find this a curious move by a director of the group, and as a result I believe that the risks from here forward lie on the downside.
I was intrigued to see, on the 13th March, Roy Gardner, Chairman of Compass group PLC (CPG, 309p) putting £200k to work (25,000 shares at 310p). I looked at managements track record with investing in their company, and found them to be pretty successful- no great blunders, but not trading in and out either.
I decided then that Compass Group should be watched. And hey presto, my inbox today shows the CEO Richard Cousins increasing his stake by 20% by buying 50,000 shares at 301.25p, investing £300k.
News ahead? Maybe a reassuring comment at the Trading Update on March 27th (see financial calendar).
See also ‘The Compass points South‘ February 8th 2009.
3i Groups (III, 820.5p) CEO Philip Rea has ample experience in dealing in his companys shares. Experience that is worth noting.
In May/June 2006 he bought 30,000 shares at an average price of 830p
In August 2007 he sold 76,203 shares at 1070p.
And now, on March 4th 2008, he is seen buying 60,000 shares at 809p
In the Interim management Statement of January 24th, Yea stated: ‘Our mid-market position and the depth of our international network have allowed us to continue to source good investment opportunities notwithstanding the more difficult economic outlook.’
If there is one person who knows what is going on on the ground, in terms of the economic performance of the companies 3i have invested in, then it’s Rea.
Reas purchase of 60,000 shares takes him to 336,000 shares, so this is what I would deem a significant investment in proportion to his current holding in the company. I’d like to see a few other directors lifting their stakes too.
But because Rea has his ear to the ground, I see this as a vote of confidence not only in 3i, but also in the broader market.
For all posts on 3i click here.
Alison Carnwath last Friday invested just shy of £1m in Land Securities (LAND, 1580p). Carnwath (bio) has held the position of non exec director since April 2004, and this appears to be her first major purchase in that time.
Previous insiders buying Lands shares have included Myners (non exec Chairman), Ellis (Executive Director) and Salway (CEO), who all bought back in July last year, at prices only about 10% higher than today.
The real estate sector is up about 11% since its low in mid November, when we started to comment on directors buys in the sector, whereas the FT All Share index has fallen by 4%.
If you look at the ratio of net activity in the sector, net buys (above £50k) number 26 companies in the sector now, versus net sells (above £50k) only four, taken over the last three months. This in itself remains a pretty strong signal to stay invested in the real estate sector.
Robert Walters (RWA, 167p) directors, having sold 4.7m shares from March to September last year, at prices between 330p and 368p, are now starting to buy back their positions.
Robert Walters, CEO, and Giles Daubeney, COO, have this week bought 740,000 shares at around the 150p mark. Allan Bannatyne, CFO, has started a position by investing about £65,000 at the same level. See Yahoo Finance for details.
In August last year Robert Walters was ‘the subject of takeover interest from leisure recruitment specialist Berkeley Scott’ (Telegraph 21/8).
In November last year we saw directors of Michael Page (MPI) and SThree (STHR) investing quite heavily, investing £1.1m between them (see Michael Page comments).
Maybe conditions in this sector, which has a high sensitivity to economic growth, aren’t as bad as the market thinks. Or maybe expect future merger activity within the sector.
Next news Tuesday March 4th- Michael Page earnings release. Expect a comment on current trading.
PayPoint (PAY, 600p) gets a good rap from Questor, and the market.
So why then are directors selling big chunks of stock?
This week PayPoint Chairman Anthony Newlands raised £1.74m selling virtually all his shares,
CEO Dominic Taylor sold £2m worth, over a fifth of his holding, leaving him with £7.3m in the company, and
Executive Director Tim Watkins – Rees in December sold a fifth of his holding, leaving him with £3.8m in the company.
On Feb 14th the company issued a reassuring update statement, but I’d be concerned about the growth rate slowing down in the longer term.
So maybe I’d do the same, sell about half my holding (the very rough average % of the directors sales above).
It’s interesting to see over the last week or so directors at Halfords (HFD), Woolworths (WLW), N Brown (BWNG), Instore (INST) and Kingfisher (KGF) add to their holdings.
Buys in the General Retailers sector over the last month took place at 14 companies (net 1 month, over £50k, source digitallook), with no companies reporting director sales. This compares with data showing, over the last twelve months (same criteria over total of twelve months), 32 companies with net buys, and 14 with net sells. I believe this to be a significant indicator for the sector, however when looking at individual companies the ‘value’ of this signal is not so clear.
In analysing directors dealings I look for a change of attitude (ie from buy to sell or vice versa) and a historically successful track record in dealing by directors of the company.
Kingfisher (KGF, 133p) Ian Cheshire, CEO, added to his holding this week by buying 268,000 shares at 148p. But he also bought stock in October ’06 at 256p. Is he averaging down, or is this a vote for himself, having taken on the CEO position on January 28th?
N Brown (BWNG, 243p) shows the CEO buying 150k at 240p, but the CFO selling 56k shares at the same price. So in my mind they cancel each other out.
However at Halfords (HFD, 276p), two non execs bought a smallish amount of shares at 269p. This is Wilsons first foray, and Pym, Halfords Chairman, increased his position by about 50%. What is interesting is that Pym bought stock in June 2006 at 289p, also 10,000 shares. Halfords share price then ran to 411p in July 2007, which incidentally is where CEO Mcleod sold a significant block of stock.
I’d like to see more buying from Halfords directors before throwing myself into this one. But Halfords should be added to the watchlist.
followthedirectors... a study of directors share dealings 