Insiders at small firms tend to earn greater profits from their stock purchases than insiders at large firms. In the small-cap area of the market, there’s more potential for significant upward share price movements.
In this report, we are going to highlight some insider buying at a small British company, Frenkel Topping Group (FEN:LN). Frenkel Topping is a financial services company that specializes in providing financial advice and investment management services to personal injury and clinical negligence victims. It is listed on the Alternative Investment Market (AIM) of the London Stock Exchange and currently has a market capitalization of £83 million.
Frenkel Topping: Insider Buying
Our insider transaction data shows that since September 28, 2021, Investment Management Group Harwood Capital has purchased FEN stock on three occasions at prices of between £0.71 per share and £0.73 per share, spending a total of around £1.8 million on the stock.
Harwood Capital, which was established in 2011 by Christopher Mills after the sale of JO Hambro Capital Management which he co-founded in 1993, is a 10% owner here. And Mr. Mills – who is CEO and Chief Investment Officer at Harwood – sits on the board at Frenkel Topping.
This trade is worth highlighting for a couple of reasons.
Firstly, Mr. Mills is a very experienced investor. As well as serving as CEO and CIO at Harwood Capital, he is the investment manager of the North Atlantic Smaller Companies Investment Trust plc, a UK-listed investment trust. Previously, he was Chief Investment Officer at JO Hambro.
Secondly, we have observed well-timed trades from Mr. Mills before. Last October, for example, he picked up a large number of shares in Bigblu Broadband at a price of £0.78 per share. Over the next three months, the stock rose nearly 50%.
Strong H1 Results
Frenkel Topping posted interim results in September that were very strong.
For the period ended June 30, 2021, revenue came in at £8.5 million, up 93% year on year. Meanwhile, EBITDA amounted to £2.4 million, up 118% year on year. Assets Under Management ended the period at 1,110 million, 15% higher than a year earlier.
The group advised that the second half of the year had begun positively, and that trading remains strong.
Looking ahead, management was confident the group is set for further growth. “The Board is confident of our future and that we have the right culture, resources, and expertise to continue to grow our business organically, execute our roll-up strategy and become the market leader in providing a full service offering to clients and claimants in PI and Clin Neg," said CEO Richard Fraser.
In light of these results and the outlook, we see the insider buying here as bullish.