Insider Buying

Insider Buying Report: TP ICAP PLC (TCAP:LN)


12-month performance: -31%
Insider activity: Bullish
Insider buying pattern: Share purchases by CEO, CFO and Chairman
Recent news: Agreed deal to buy Liquidnet

Top-level corporate insiders generally have deep insight into their own companies’ operations. If these insiders are buying stock, investors should take note.

Here, we are going to highlight share purchases by the CEO, CFO, and Chairman at TP ICAP (TCAP:LN). TP ICAP is a global firm of professional intermediaries that operates in the world’s financial, energy, and commodities markets. It’s listed on the London Stock Exchange and has a market capitalization of £1.22 billion.

TP ICAP: insider buying

Regulatory filings show that on 9 October the CEO of TP ICAP, Nicolas Breteau, purchased 10,000 TP ICAP shares at a price of £2.30 per share. On the same day, the Chairman, Richard Berliand, bought 25,000 shares at a price of £2.29 per share. Then, on 13 October, CFO Robin Stewart bought 10,000 shares at a price of £2.21 per share.

TCAP-LN (chart)     Source: 2iQ Research

Cluster buying

These purchases look interesting for two reasons. First and foremost, the purchase of stock by three powerful insiders simultaneously, gives out a strong signal of confidence to the market. It represents a bullish signal.

Secondly, the Chairman’s purchase of 25,000 shares lifted his holding by 50% to 75,000 shares. This suggests he is very confident in TP ICAP’s future prospects.

Transformational deal

TP ICAP recently announced terms had been agreed to acquire the entire issued share capital of Liquidnet for a total share consideration of between $575 million and $700 million. Based on Liquidnet’s share price at the close of business on 8th October, by year three the acquisition is expected to be accretive to underlying EPS. The announcement that they will continue to invest in Liquidnet’s dark/block cash equities platform suggests TP ICAP see further opportunities for growth which could boost profitability.

Taking into account this recent news, we see the insider buying here as a bullish signal. It suggests that the CEO, CFO, and Chairman believe the Liquidnet deal will be more enhancing to TP ICAP’s earnings than the market is expecting

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