Director Trades: Who is counting on a strong return after dip?
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ASX Director share trading is often considered a good indicator of a company’s future prospects. Our ASX Director Trades column informs you who is buying in and who is selling down. Often referred to as insider buying or selling, directors are legally permitted to buy and sell shares of the company and any subsidiaries. However, these transactions must be properly registered and divulged.
Insider buying or selling is not to be confused with insider trading, which is buying shares based on non-public information, a big no-no and illegal.
We troll through the ASX company announcements looking at director trades of interest over the past fortnight. It’s usually the big ones that stand out or those coinciding with company news.
Directors may get shares as part of employee incentive schemes, share purchase plans, rights issues, participate in dividend reinvestment plans or purchase on-market. It’s the on-market trades we think are worth noting, where directors directly or indirectly through entities they are associated either put up cash or cash in a stake.
When a director buys shares on-market, it can signify confidence the share price will rise in the future and if multiple directors are buying, especially at larger amounts, that is even more of an indication. Of course, it’s not a sure win that the share price will rise, so it’s always worth further research on a company.
Directors will often buy company shares after a sharp price decrease. Directors may think the stock has been oversold and represents good value, sometimes they want to show confidence in their company’s prospects, other times they’ve just got another good reason to buy or sell a stock which will be divulged, like paying the good ol’ taxman.
The S&P/ASX 200 ended last week ~1.5% down and had a monthly loss of 5.5%. But it was more positive news on Monday as the market rebounded after the RBA announced it was raising rates by 0.25%, lower than the 50bps markets had anticipated.
Local shares surged 3.8% shortly after the RBA’s afternoon statement. The increase still took the cash rate to 2.60% for the first time since mid 2013 and followed release of August monthly inflation figures last week, which showed headline inflation running at 6.8%, well above the RBA’s 2-3% target.
Over in the US, negative sentiment in the markets persisted with Wall Street closing out one of its worst Septembers in the last 20 years. Meanwhile, there was also market turmoil in the UK last week with the pound plunging on inflation and recession fears along with controversial tax changes announced by the Government.
ASX director share trading has remained strong during recent sell-offs with some large buys and sells.
Swipe or scroll to reveal the full table.
|Company||Director||Direct or Indirect||Date||Volume||$||Nature of change|
|SOL||Washington H. Soul Pattinson||Thomas Charles Dobson Millner & Robert Dobson Millner||Indirect||Sep 23-28||1,700,000||$4,515,162.06||On-market|
|NHC||New Hope Corporation||Thomas Charles Dobson Millner & Robert Dobson Millner||Indirect||Sep-28||300,000||$1,862,910.00||On-market|
|APE||Eagers Automotive||Nicholas George Politis||Indirect||Sep 28, 29, 30 & Oct 3||40,000||$440,740.00||On-market|
|FPC||Fat Prophets Global Contrarian Fund||Angus Geddes||Direct & Indirect||Sept 21, & 23||301,614||$255,316.00||On-market|
|PWR||Peter Warren Automotive Holdings||Paul Howard Warren||Indirect||Sept 14 & 15||86,512||$254,380.55||On-market|
|LLL||Leo Lithium||Amber Banfield||Indirect||Sept 19, 21,23,26||298,022||$199,972.27||On-market|
|JDO||Judo Capital Holdings||David Stephenson Hornery||Indirect||Sep-20||170,000||$195,449.00||On-market|
|COL||Coles Group||Wendy Margaret Stops||Direct||Sep-27||10,000||$167,235.00||On-market|
|RUL||RPMGlobal Holdings||Ross Collins Needham Walker||Indirect||Sep-27||100,000||$149,960.00||On-market|
|CYG||Coventry Group||Alexander James White||Direct & Indirect||Sep-29||105,000||$125,895||On-market|
|COL||Coles Group||Richard Freudenstein||Direct||Sep-27||6,000||$100,200.00||On-market|
As Stockhead’s Christian Edwards reports, the All Ords is down around 15% this year but coal stocks have been faring well, with the NHC share price up ~172% year to date.
Among other buys worth noting, Fat Prophets Global Contrarian Fund (ASX:FPC) founder and CEO Angus Geddes topped up his holdings, while Peter Warren Automotive Holdings (ASX:PWR) executive director Paul Howard Warren ponied up for more shares in the company his father Peter Warren started more than 60 years ago.
The PWR share price has felt the impact of inflation and selloffs on markets and is down ~8% year to date but has held its head above water in the latest sell off up 1.14% in the past month.
|Code||Company||Director||Direct or Indirect||Date||Volume||$||Nature of change|
|WTC||WiseTech Global||Richard White||Indirect||Sept 23-29||119,667||$6,476,378.04||On-market|
|WTC||WiseTech Global||Richard White||Indirect||Sept 16-21||91,414||$5,185,002.08||On-market|
|ALK||Alkane Resources||Ian Jeffrey Gandel||Indirect||Sep 27-30||5,930,193||$3,926,814.75||On-market|
|LLL||Leo Lithium||Alistair Cowden||Indirect||Sep-20||1,135,110||$845,186.73||On-market|
|VEA||Viva Energy Group||Scott Wyatt||Indirect||Sep-23||200,000||$547,266.24||On-market|
|ALK||Alkane Resources||Ian Jeffrey Gandel||Indirect||Sep-30||200,000||$134,000.00||On-market|
Software solutions to the logistics company WiseTech (ASX: WTC) founder, executive director and CEO Richard White is continuing his large sell-down in the company he founded in 1994 and listed on the ASX in 2016.
The WTC share price is down more than 14% year to date.
Gold miner Alkane Resources (ASX:ALK) saw its non-executive chairman Ian Jeffrey Gandel sell down stock ~$4 million worth of stock indirectly.
Gandel still owns 126,062,313 shares indirectly in ALK, which has seen its share price down ~20% year to date.