12-month performance: +78% Insider activity: Bullish Insider buying pattern: Large purchases from Chairman Recent news: Good H1 results
Research shows that the actions of company insiders provide consistent predictive power across all market conditions. The evidence is clear – if insiders are buying or selling stock, investors should take note.
In this article, we are going to highlight a large insider purchase at Encavis AG (CAP:GR). Encavis is a German renewable energy company that acquires and operates solar and wind parks. It’s listed on the XETRA and currently has a market capitalization of €2.0 billion.
Encavis: insider buying
What’s caught our attention here is two large purchases from Encavis’s Chairman of the Supervisory Board, Manfred Krueper this month. Our records show that the insider purchased 20,000 CAP shares on 3 September and then purchased another 20,000 CAP shares on 8 September. In total, the insider spent €573,000 on Encavis stock.
Source: 2iQ Research
These insider purchases are significant for several reasons. Firstly, they are large purchases. Combined, they represent the largest amount of insider buying at Encavis within a quarter since Q4 2018.
Secondly, the insider has considerable industry experience. Not only is Krueper Chairman of the Supervisory Board at Encavis but he is also Chairman of the Supervisory Board at Coal & Minerals GmBH and Power Plus Communications GmBH. On top of this, he is a member of the Management Board at E.ON AG. Given his experience, we see his purchases as a positive development.
Good H1 results
Encavis issued a good set of H1 results in late August. First-half revenue increased by 8% while operating cash flow was significantly above the figure last year. The group advised that following the overall positive development in the first half of the year, it expects its growth to continue and it reaffirmed its sales and earnings forecasts for the current fiscal year 2020.
In light of these results, we see the insider buying here as a bullish signal. The company appears to have momentum right now and Krueper clearly believes the stock can continue rising.
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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