Top-level company insiders tend to have an information advantage over other investors. If these insiders are buying company stock, it can be a sign that the stock is undervalued.
In this report, we are going to look at some recent insider buying at Montea SA (MONT:BB). Montea is a Belgian real estate investment trust that is focused on logistics and semi-industrial real estate in Belgium, the Netherlands and France. It is listed on the Euronext Brussels and currently has a market capitalization of €1.5 billion.
Montea: Insider buying
Our records show that on 4 January, Montea’s Founder and Chairman Dirk De Pauw purchased 10,500 shares at a price of €94.19 per share. This purchase cost the insider a total of €988,995.
This insider transaction is significant due to its size. Our records show that large insider purchases at Montea are quite rare. In 2019 and 2020, for example, the largest insider purchase was worth just €13,000. The fact that De Pauw has spent just under €1 million on company stock sends a clear signal that he is confident the stock is undervalued at present.
Strong Q3 results
Montea posted a robust set of third-quarter results in November. For the nine months ended 30 September, EPRA earnings were €42.2 million, up 13% on the same period in 2019. Meanwhile, the fair value of the property increased by €126 million, or 11%, compared with the end of 2019 to €1,285 million. The company said that as of 3 November 2020, it had received 99% of the total rent due.
Looking ahead, Montea said that it was reaffirming its aspiration to boost its property portfolio by ca. €300 million in 2020 and 2021, which will result in a total property portfolio of €1,450 million by the end of 2021. 75% of this growth has already been identified.
In light of these strong results, and the company’s aspirations for the future, we see the insider buying here as bullish.