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 executives and directors.
In this report, we are going to highlight some interesting insider buying at Watches of Switzerland Group (WOSG:LN). Watches of Switzerland is a retailer that sells luxury watches. Operating through its own-branded Watches of Switzerland stores, as well as its Mappin and Webb, Mayors, and Goldsmiths stores, it sells watches from a range of manufacturers including Rolex, Omega, and Tag Heuer. The company is listed on the London Stock Exchange and currently has a market capitalization of around £1.4 billion.
2iQ data shows that on September 1, four insiders at WOSG bought stock. Those who bought shares were:
CFO Anders Romberg (100,000 shares @ £5.85 per share)
Chairman Ian Carter (35,000 shares @ £5.88 per share)
Board member Robert Moorhead (8,495 shares @ £5.84 per share)
Board member Tea Colaianni (8,500 shares @ £5.86 per share)
Combined, the insiders invested just under £900,000 in the company.
Cluster Buying Pattern
This trading activity is worth highlighting for a few reasons.
Firstly, there is a clear cluster buying pattern here. This pattern – where multiple insiders at the same organization are buying stock simultaneously – is one of the most bullish insider transaction patterns.
Secondly, the insiders have invested a substantial amount of money in the company. The purchase from CFO Anders Romberg, worth roughly £585,000, is particularly notable as CFOs tend to have an excellent understanding of their companies’ operating activities.
Rolex Moving Into Retail?
Watches of Switzerland stock recently tanked after it came to light that Rolex is buying luxury watch retailer Bucherer.
This move stoked fears that Rolex – which is the largest and most powerful luxury watch brand in the world – could be moving into retail and could potentially eliminate middlemen like Watches of Switzerland.
In a statement, however, Watches of Switzerland Group said that this is not a strategic move into retail by Rolex. It also said that there will be no change in Rolex’s product allocation or distribution processes as a consequence of the acquisition.
Clearly, the insiders who have bought stock here believe that the Rolex/Bucherer deal won’t impact the company too much, and that the stock will bounce back.
Given the fact that four insiders have bought shares at the same time, we think WOSG stock could be worth a closer look right now.