12-month performance: -15% Insider activity: Bullish Buying pattern: Purchases from multiple insiders including CEO Recent news: Provided a cautious outlook
Evonik Industries is a German specialty chemicals company. The group operates four main segments including nutrition and care, resource efficiency, performance materials, and services, and its products can be found in a wide variety of end products such as car tires, mattresses, tablets, and animal feed. The company is listed on the XETRA and currently has a market capitalisation of €10.2 billion.
In early March, Evonik provided a cautious 2020 outlook. The company said that it would be impacted by the coronavirus, and advised that for the year it was expecting to take a hit of around €30 million as a result of the outbreak. However, CEO and Chairman of the Executive Board Christian Kullmann also advised that he was expecting the group to be through the worst of the Covid-19 disruption by the end of the first quarter, and that the company was expecting to continue making acquisitions in the short term. In addition, Evonik said that it would be buying back €126 million of its own shares.
Source: 2iQ Research
Since the beginning of March, we have observed three insider purchases at Evonik. Earlier in the month, Executive Board member Thomas Wessel and Supervisory Board member Dr. Siegfried Luther purchased a total of 9,000 EVK shares, while on 31 March, Kullmann – who has been with the company for 13 years – bought 15,500 EVK shares. Combined, these purchases represented the largest amount of insider buying since late 2018. In our view, this pattern of buying is bullish, as it tells us that insiders are confident about the future.
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