Insider Buying

Insider Buying Report: Telia Company AB (TELIA:SS)

Telia Company AB (TELIA:SS)

12-month performance: -18%
Insider activity: Bullish
Insider buying pattern: Purchase from President/CEO, COO and other insiders
Recent news: Strategic deals with Ericsson and Nokia

Top-level corporate executives such as CEOs and COOs tend to have an information advantage over other investors. If these insiders are buying company stock, it can be a sign the stock is undervalued.

Here, we are going to highlight multiple insider share purchases at Telia Company AB (TELIA:SS). Telia is a telecommunications group that provides network access, telecommunications and other services to customers primarily in Sweden, Norway, Denmark, Finland and the Baltic States. It’s listed on the Nasdaq Stockholm Exchange and currently has a market capitalization of SEK 145.2 billion.

Telia Company: insider buying

Regulatory filings show that on 22 October the President/CEO of Telia, Allison Kirkby, purchased 25,000 TELIA shares at a price of 36.40 SEK per share. On the same day, the COO, Jens Anders Olsson, purchased 15,000 TELIA shares at a price of 35.52 SEK per share and an Executive Vice President bought 2,500 shares. A Head of Division also bought 20,000 shares on 23 October. 

TELIA-SS (chart)     Source: 2iQ Research

Strong cluster buying

This insider buying looks extremely interesting. It is not often that you get four top insiders buying stock simultaneously. Such strong cluster buying sends a signal to investors that there is a lot of confidence within the company that the shares are undervalued by the market.

It’s likely that the President/CEO and the COO have access to the most up-to-date trading information. This means that they are able to make the most informed decisions in relation to the company’s stock. Investors should take note that these top-level insiders are buying.

Strategic agreements

Telia shares are currently down around 14% year to date. This is due to the fact that the company has been impacted by Covid-19.

There has been a lot of positive news recently, however. The company has signed strategic agreements with both Ericsson and Nokia to ensure the foundations have been laid to build a highly capable 5G network in the future focusing on Estonia and Sweden. An agreement has also been signed to divest the Telia Carrier business for a value of SEK 9.45 billion. Given that operational free cash flow is expected to be in the range of SEK 9.5 billion to SEK 10.5 billion for the full year, the Board of Directors has proposed an additional dividend of SEK 0.65 per share.

Given the recent news, we see the insider buying here as a bullish signal. It suggests that the President/CEO and other key insiders believe the share price is too low currently.

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