Insider buying can provide clues about a stock’s next move. Insiders sell company stock for a number of reasons. Yet they only buy stock for one reason – they expect it to rise.
Here, we are going to look at recent insider buying at GlobalData PLC (DATA:LN). GlobalData is a data analytics and consultancy business that is headquartered in the UK. The company, which was founded in 1999, has a global client base that includes government organizations, multinational companies, and industry professionals. It is listed on the London Stock Exchange’s AIM market and currently has a market capitalization of £1.39 billion.
Insider buying at GlobalData
Our insider transaction data shows that on August 11, board member Peter Harkness bought 20,000 DATA shares at a price of £12.64 per share. This purchase cost the insider around £250,000 (approx. $300,000) and increased his holding by about 35%.
First insider purchase since 2018
This trade got our attention due to the fact that insider purchases at GlobalData are not common. Our data shows that this trade represents the first purchase from an insider at the company since May 2018.
Additionally, Mr. Harkness has increased his holding by a significant percentage. This indicates that he is very bullish on the stock at present.
It’s worth noting that Mr. Harkness – who has served as Non-Executive Director at venture capital firm Chrysalis VCT PLC – has expertise in subscription models. He is therefore likely to have a good understanding of the potential of the business.
GlobalData posted impressive first-half results, with revenue and EBITDA rising year on year.
The revenue number of £111.9 million was 23% higher than H1 2021 with underlying growth of 10%. Meanwhile, adjusted EBITDA for the first half of 2022 came in at £39 million, up 27% on the year prior. Free cash flow was £45.7 million, up from £34.7 million in H1 2022, showing that the business is highly cash generative.
On the back of these solid results, the company raised its interim dividend to 7.7 pence, a 26% increase on the year before.
“The premium assets that are embedded in our platform have a history of growth and resilience during economic cycles and it is pleasing to see this continue in our H1 2022 results,” said CEO Mike Danson. “This strength in our business model, high cash generation and the must-have intelligence we provide our clients gives us confidence in our growth prospects for the second half of the year and beyond,” he added.
Having looked through these half-year results, we see the insider buying here as bullish.