Corporate insiders tend to have the most up-to-date information on their firms. If these individuals are buying company stock, it can be worth taking a closer look.
In this report, we are going to highlight some interesting insider buying at Intertek Group PLC (ITRK:LN). Intertek is a UK-based company that provides quality assurance services. Operating in over 100 countries, it provides bespoke assurance, testing, inspection and certification services to businesses in a wide range of industries. The company is listed on the London Stock Exchange and currently has a market capitalization of £8.9 billion.
Intertek Group: Insider Buying
In the last few weeks, we have seen two large insider purchases at Intertek Group. The first was a purchase of 10,000 shares from CEO Andre Lacroix on 15 March. The second was a purchase of 7,000 shares from Chairman Andrew Martin on 22 March. In total, these two insiders spent around £920,000 on ITRK stock.
This director dealing activity is worth highlighting for a couple of reasons. Firstly, these are top-level insiders that have purchased stock. Both Lacroix and Martin are likely to have an excellent understanding of the company’s recent performance and its future prospects.
Secondly, both insiders have made substantial purchases. Our records show that these purchases represent the largest amount of insider buying at Intertek within a quarter for several years. This suggests that these insiders are quite confident that now is a good time to be buying ITRK stock.
Strongly Positioned for Growth
Intertek delivered a resilient performance in 2020, ahead of earnings and cash expectations. While the first half of the year was challenging due to Covid-19 disruptions, performance rebounded in the second half of the year. For H2, revenue came in at £1,411 million, up 7.8% on H1 revenue, and adjusted earnings per share came in at 107.8p, up 73% on H1 EPS. For the year, adjusted free cash flow was up 10.2% year on year.
Looking ahead, Intertek said that it is strongly positioned for growth. “In 2021, we will continue to benefit from the Covid-19 recovery and the attractive growth opportunities in our industry. We are confident that the group will continue to drive sustained value for our shareholders with year-on-year progress in revenue, margin and cash,” said CEO Andre Lacroix.
In light of this confidence from management, we see the insider buying here as bullish.