Insider Buying

2iQ Insider Brief: ITM Power (ITM: LN)

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ITM Power (ITM: LN)

12-month performance: +854%
Insider activity: Bearish
Selling pattern: Large sale from CEO
Recent news: Issued a trading update

ITM Power is a UK-based renewable energy company that specialises in integrated hydrogen energy solutions designed to utilise renewable energy that would otherwise be wasted. The company is listed on the Alternative Investment Market (AIM) of the London Stock Exchange and currently has a market capitalisation of £1.3 billion.

ITM Power shares have enjoyed a strong run recently. Over the last three months, the AIM-listed stock has risen approximately 170%, while over the last year, it has risen roughly 870%. One of the key drivers of this share price strength has been the company’s 50/50 joint venture with multinational chemical company Linde, which was announced in October 2019. The aim of this joint venture is to deliver green hydrogen to large scale industrial projects that exceed 10 MW of installed electrolyser capacity.

itm pOWER CHART                        Source: 2iQ Research


Looking at insider transaction activity here, we think caution is warranted towards ITM Power shares at present. We say this because CEO Graham Cooley recently offloaded a large quantity of shares. According to regulatory filings made by the company, Cooley dumped a total of 2.3 million ITM shares on 9 June (1.8 million of which were related to options), netting a total of around £6.6 million. These sales reduced his holding to just 600,000 shares. This insider selling activity could be interpreted as a bearish signal, particularly given the stock’s strong run over the last year.

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