2iQ Insider Brief: XPS Pensions Group PLC (XPS: LN) Biohaven Pharmaceuticals (BHVN: US) Eldorado Gold Corp (ELD: CN)

Desislav Delchev 9 July 2019

XPS Pensions Group PLC (XPS: LN)

12-month performance: -39%
Insider activity: Bullish
Buying pattern: Purchases from multiple directors including Co-CEO
Recent news: Profit warning 

XPS Pensions Group is a UK-based financial services company that specialises in pensions consulting and administration. Providing a range of advisory and compliance services, it is the largest pure pensions consultancy in the UK with over 550 clients. The stock is listed on the London Stock Exchange and currently has a market capitalisation of £221 million.

XPS Pensions’ share price fell 40% last week after the company released full-year results. Despite the fact that total revenue increased 75% for the year, profit before tax surged 245%, and the dividend was lifted 5%, investors dumped the stock as the company warned that pension revenue will be flat in the current year and profits will be impacted by a one-off increase in central costs.
chart 5 july firstSource: 2iQ Research


Looking at insider transaction activity here, we think investors may have overreacted to the recent update. We say this because this week three directors have purchased shares in XPS, including Co-CEO Paul Cuff, which suggests that these insiders are confident about the future and expect the shares to rise going forward. With the group advising that the “broader market backdrop is favourable” and three insiders spending their own money on stock after the sharp share price fall, we think there’s a good chance XPS shares could rebound in the future.


Biohaven Pharmaceuticals (BHVN: US)

12-month performance: 8%
Insider activity: Bullish
Buying pattern: Purchases from multiple directors including CEO and CFO
Recent news: Announced stock offering 

Biohaven Pharmaceuticals is a clinical-stage biopharmaceutical company. Its portfolio is comprised of innovative, late-stage product candidates that target neurological and neuropsychiatric diseases and since the group’s initial public offering in 2017 it has made significant progress. The stock is listed on the New York Stock Exchange and currently has a market capitalisation of $2.3 billion.

Biohaven Pharmaceutical shares have had a volatile year so far. In April, the stock surged 20% after the company said that it was attracting takeover interest from potential buyers and that it was exploring a sale. However, in mid-June, the shares fell sharply after the group announced a $300 million stock offering – suggesting a sale was not imminent. After reaching a high of $67 in early June, the shares currently trade at around $45.
chart 5 july second
Source: 2iQ Research

Analysing recent insider transaction activity, we think Biohaven is worth keeping a close eye on. This is due to the fact that in late June, four top-level directors purchased shares in the company – including CEO Vlad Coric and CFO James Engelhart – spending over $800,000 on stock. This indicates that these insiders are confident about the future and expect the share price to rise. While Biohaven may not be sold any time soon, it’s possible that negotiations are continuing and that management is raising the extra capital as a bargaining chip. With four insiders buying shares, we think BHVN is a stock to watch closely.


Eldorado Gold Corp (ELD: CN)

12-month performance: 23%
Insider activity: Bullish
Buying pattern: Purchases from CEO and CFO
Recent news: Broker upgrades 

Eldorado Gold Corp is a Canadian gold mining company. The group has operations in Canada, Turkey, Brazil, Greece, Serbia and Romania, and its activities include all facets of mining including exploration, development, production, and reclamation. The stock is listed on the Toronto Stock Exchange and currently has a market capitalisation of CAD $1.2 billion.

Eldorado Gold shares have had a good year so far, rising from CAD $4 to CAD $8 – a gain of 100%. The gold stock has been boosted by a number of factors, including the rising gold price, a number of broker upgrades, and hopes that a snap poll called by Greece could result in the election of a new business-friendly party and help resolve permit problems Eldorado has faced for years over its two mines in the country.
chart 5 july third
Source: 2iQ Research

Looking at insider transaction activity at Eldorado, we think the shares could have further upside. We say this because in late June, both CEO George Burns and CFO Philip Yee purchased shares in the company at around the CAD $7.40 to CAD $7.50 mark, which suggests these insiders expect the shares to keep climbing. With the National Bank of Canada recently lifting its price target for the stock to CAD $9.50, the gold price breaking out above USD $1,400 for the first time since 2013, and two directors buying shares, we think the uptrend here could have further to run.

Disclaimer: Neither 2iQ Research GmbH nor its content providers are responsible for any damages or losses arising from any use of this information.

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