Insider transactions can give investors a more complete view of activity within the world’s publicly-listed companies. No one has more information in relation to a company’s prospects than its leaders.
In this report, we are going to highlight some interesting insider buying at London Stock Exchange Group PLC (LSEG:LN). London Stock Exchange is a global financial markets infrastructure and data group. The company, which owns both FTSE Russell and Refinitiv, has leading capabilities in data and analytics and is also a top provider of capital markets and post trade services. It is listed in London and currently has a market capitalization of £37.4 billion.
London Stock Exchange Group: Insider Buying
Our data shows that on November 18, CEO David Schwimmer purchased 5,000 LSEG shares at a price of £66.80 per share. This trade cost the insider £334,000 and increased his holding to 32,109 shares.
Mr. Schwimmer – who joined London Stock Exchange Group in 2018 – has extensive financial services experience having previously spent 20 years at Goldman Sachs in a number of senior roles including Global Head of Market Structure. This means he is likely to be adept at valuing companies.
This trade from Mr. Schwimmer represents his first open-market purchase since he joined the group. The fact that the insider has spent over £300k of his own money on stock suggests that he sees value at current levels. It’s worth noting that our data shows that this is the largest insider purchase at London Stock Exchange since March 2019 when Chairman Don Robert spent £464,000 on stock.
Solid Q3 Results
London Stock Exchange posted a relatively solid set of Q3 results in October.
For the quarter, the group generated 6.0% year-on-year revenue growth in Data & Analytics, 17.2% top-line growth in Capital Markets, and 2.3% revenue growth in Post Trade services. Overall, total revenue growth was 7.6% at constant currency.
Meanwhile, the company advised that it continued to make good progress on the integration of Refinitiv and was comfortably on target for the full-year run-rate cost synergy of £125 million.
“The Group has delivered a strong Q3 financial performance with revenue growth across all divisions,” said Mr. Schwimmer. “The Group is well placed as we make targeted investments in product and technology enhancements to help us meet the needs of our customers and capitalise on the growth trends driving change across our industry,” he added.
Since the results, the company’s share price has pulled back. It seems investors didn’t like the fact that the group advised that it expects income in Q4 to not grow as fast as it did in Q3.
The large purchase from the CEO here suggests that he expects the stock to bounce back. We see this insider buying as a bullish indicator.