Cluster buying is one of the most bullish insider transaction patterns. This is where three or more insiders at a company have purchased stock within a short space of time.
In this report, we are going to highlight a cluster purchase at Horizon Global Corporation (HZN:US). Horizon Global is a leading designer, manufacturer, and distributor of custom-engineered towing, trailering, and cargo management accessories. Operating in the US, Europe, and Africa, it serves OEMs, retailers, dealer networks, and end consumers. The company is listed on the New York Stock Exchange and currently has a market capitalization of $213 million.
Horizon Global: Insider Buying
Our data shows that between 7 May and 10 May, three insiders at Horizon Global purchased stock. Those who bought shares were:
- Chairman John Kennedy (20,000 shares)
- President/CEO Terry Gohl (7,000 shares)
- Board member John Barrett (101,616 shares)
Combined, these insiders spent around $940,000 on the stock.
These insiders are likely to have access to the most up-to-date information in relation to Horizon Global’s business performance. Both Gohl and Kennedy are top-level insiders. Meanwhile, Mr. Barrett is a Managing Partner & Portfolio Manager at Corre Partners Management LLC – Horizon’s fourth-largest shareholder.
It’s worth noting that Gohl and Kennedy have made well-timed purchases in the recent past. Both purchased HZN stock in March last year when it was trading near $2. Since then, it has risen to $8.
Strong Order Book
Horizon Global’s Q1 results showed that the company has momentum right now. For the period, net sales were $199.2 million, up 22% year on year, while operating profit was $6.8 million, a $13.5 million improvement compared to the prior year comparable period. The company said that while a proportion of its period-over-period net sales increase was attributable to the Covid-impacted environment in the back half of March 2020, demand levels in January and February 2021 “far exceeded” those from the prior year periods.
Looking ahead, Horizon said that it has strong order book momentum as it enters the traditional peak selling season in North America. It also advised that it is now proceeding to the execution phase of its operational excellence measures across its Europe-Africa segment and that this should help realize profitable growth in the segment.
“We expect our global efforts to generate both near-and long-term value for our employees, customers, and shareholders,” said CEO Terry Gohl.
In light of this performance, we see insider buying here as bullish.