Insider trades 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, and its prospects, than its executives and directors.

In this report, we are going to highlight some interesting insider buying at Sage Group PLC (SGE:LN). Sage is a UK-based technology company that offers cloud-based accounting, HR, and payroll solutions. Operating in North America and Europe, it targets small and medium-sized businesses. It is listed on the London Stock Exchange and currently has a market capitalization of approximately £8.19 billion.

Insider Buying at Sage

2iQ data shows that on January 23, Sage’s Chief Product Officer Walid Abu-Hadba participated in legal insider trading by purchasing 40,000 SGE shares at a price of £7.66 per share. This trade cost the insider £306,400 and increased his holding to 81,865 shares.

Technology Expertise

Mr. Abu-Hadba – who joined Sage in May 2021 – has considerable experience in the technology industry. Before joining Sage, he spent 20 years at Microsoft where he was corporate vice president responsible for the developer and platform evangelism group. Currently, he holds several senior board advisor roles in the technology sector and patents in the field of AI. Given his experience, he is likely to have a good understanding of Sage’s potential.

What stands out here is that Mr. Abu-Hadba has nearly doubled the size of his holding with this purchase. This suggests that he is very confident the stock is set to move higher.

Trading Update

Sage recently posted a solid trading update for the first quarter of its FY2023 fiscal year.

For the quarter ended December 31, 2022, recurring revenue was up 12% to £517 million, underpinned by a 31% rise in Sage Business Cloud revenue. Software subscription revenue rose by 18% to £422 million, resulting in subscription penetration of 78% (Q1 22: 73%). On an organic basis, total revenue growth was 9%.

On the back of this solid performance, the group reiterated its guidance for the full year.

“Sage has made a strong start to the year, in line with our expectations, as Sage Business Cloud solutions help more customers improve their productivity and resilience. While we are mindful of the current macroeconomic environment, we remain confident in our strategy for delivering efficient growth and we reiterate our guidance for the full year, as set out in our FY22 results announcement,” said CFO Jonathan Howell, Chief Financial Officer.

In light of this solid update, we see the insider trade here as a bullish development.

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