Corporate executives and directors tend to have the most up-to-date information on their companies' operating activities. If these insiders are buying stock, it’s often worth taking a closer look.
In this report, we are going to highlight a large insider purchase at Crown Holdings Inc (CCK:US). Crown Holdings is engaged in the design, manufacture, and sale of packaging products for consumer goods. The company is the number one producer of food cans and metal vacuum closures in the world and the number two producer of beverage cans globally. It is listed on the New York Stock Exchange and currently has a market capitalization of $14.1 billion.
Crown Holdings Inc: Insider Buying
Our data shows that on 10 August, Director Craig Owens bought 2,000 CCK shares at a price of $105.62 per share. This purchase – which cost the insider around $211,000 – increased his holding to 5,036 shares.
66% Increase in Position Size
This insider trade stands out for a couple of reasons. Firstly, it is large in size. Our data shows that it is the largest purchase at Crown Holdings for several years.
Secondly, it has increased the size of the insider’s position by 66%. The fact that Mr. Owens has boosted his holding by such a significant percentage indicates that he is very confident the stock is set to rise.
Strong Q2 Results
Crown Holdings posted a strong set of second-quarter results in July. Net sales in the second quarter amounted to $2,856 million compared to $2,137 million in the second quarter of 2020 reflecting increased beverage can and transit packaging sales unit volumes, while income from operations was $385 million for the quarter versus $208 million in the second quarter of 2020. Adjusted earnings per share came in at $2.14, compared to $1.33 in Q2 2020, comfortably beating the consensus forecast of $1.78.
Looking ahead, management was confident about the future with CEO Timothy Donahue stating that the group remains on track for another record year in earnings. The group said that for Q3, it expects to generate adjusted earnings per share of $1.90 to $2.00 – above the consensus forecast of $1.70.
In light of these results, we see the insider buying here as a bullish indicator.