12-month performance: +158% Insider activity: Bullish Insider buying pattern: Large purchase from CEO Recent news: Strong H1 results
Top-level corporate insiders such as CEOs tend to have the most up-to-date information on their businesses. If they’re buying company stock, it’s generally a bullish development.
In this report, we are going to highlight a recent CEO purchase at Solaria Energia Y Medio Ambiente SA (SLR:SM). Solaria is a Spanish company that operates in the renewable energy sector. It is listed on the Madrid Stock Exchange and currently has a market capitalization of €2.16 billion.
Solaria: insider buying
Our records show that on 15 October, CEO Arturo Diaz-Tejeiro Larrañaga purchased 29,000 SLR shares at a price of €17.56 per share. The total cost of the transaction was €509,240.
This was the insider’s third purchase since the beginning of August. In total, he has spent about €2.4 million on stock in less than three months.
Source: 2iQ Research
High insider IQ
This insider purchase looks interesting for a number of reasons. Firstly, it is a large buy. It indicates that the CEO is confident about the future. He has also bought at a higher price than his previous purchases, which is a good sign.
Secondly, the insider has a high 2iQ long-term trading IQ of 117. This tells us that he has a good track record in terms of timing his purchases well.
Strong H1 results
Solaria posted anexcellent set of first-half results in late September. For the period, total revenue was up 41% to €28.6 million while net profit was up 49% to €14.8 million. Energy production was up 262% to 195.8 GWh – a new record for the group. The company advised that even in a Covid-19 world, it is able to secure long-term cash flow and maintain its 12% project IRR target.
Given these strong results, we see the insider buying here as a bullish signal. The company has momentum right now and the CEO clearly thinks the stock can continue to climb higher.