Corporate insiders have the most up-to-date information on their companies’ operations. If these individuals are buying company stock, it’s often a sign that business performance is strong and that the outlook for the stock is favorable.
In this report, we are going to highlight some interesting insider trading cases at Siemens Energy (ENR:GR). Siemens Energy is an energy company that specializes in wind power technologies, grid technologies, industry transformation services, and gas services. It’s listed on Deutsche Börse’s Xetra and currently has a market cap of €13.52 billion.
Insider Buying at Siemens Energy
2iQ data shows that in the last month, two insiders at Siemens Energy have made large stock purchases. On December 19, CFO Maria Ferraro purchased 30,000 ENR shares at a price of €16.87 per share. Then, on January 5, Executive Board member Tim Holt purchased 35,000 ENR shares at a price of €18.90 per share. Combined, the insiders invested around €1.17 million in stock.
What stands out here is that both insiders have increased the size of their stock holdings significantly. Ms. Ferraro has increased the size of her holding from 1,872 shares to 31,872 shares. Meanwhile, Mr. Holt has increased the size of his holding from 1,180 shares to 36,180 shares. This suggests that the insiders see a lot of value in the stock right now.
Solid Q4 Results
Siemens Energy recently posted solid Q4 FY2022 results.
For the quarter ended September 30, 2022, sales amounted to €9.2 billion, up by 5.9% year on year on a comparable basis and ahead of the consensus estimate of €8.8 billion. Net income came in at €378 million versus a net loss of €383 million the year before while pre-tax free cash flow amounted to €1,949 million, exceeding the prior-year quarter’s figure of €985 million comfortably.
Looking ahead, the company said that it expects revenue growth of 3-7% this financial year. It also said that it expects a “sharp reduction” in net loss. It noted that at the end of September, it had a record order backlog of €97.4 billion.
After the Q4 results, analysts at Jefferies said that the company reported a "solid finish" to 2022 while analysts at Berenberg said that the "very strong beat" to Q4 free cash flow should be taken as a positive.
In light of these results, we see the insider transactions here as a bullish signal.