In this new series of blogs, we will be returning to previous insider trading reports to examine how a company’s stock has performed.
In this opener, we revisit our report on Hermes International (RMS:FP) from December 2020.
Why Is It worth Tracking the Stock Prices from Insider Trades?
2iQ Research regularly produces reports on significant insider trading activity. Insiders not only have access to real-time information for their companies but also carry a wealth of experience and knowledge to help them evaluate a business’ prospects.
Revisiting insider activity is a great way of illustrating the profitability of tracking insider investment decisions and lets us assess the investing IQ of those traders.
Hermes International Insider Trading Activity
Hermes is a French luxury goods manufacturer with world renown. 2iQ reported on the bullish investment patterns of two prominent Hermes insiders:
- Ex-President and CEO Laurent E. Mommeja on 7 December 2020 purchased 2,400 RMS shares. This purchase was worth just under €2 million.
- Supervisory Board member Renaud Mommeja on the 14 and 17 December 2020 purchased a cumulative 2,500 shares for about €2.1 million in total.
Not only are these substantial purchases, but Hermes insiders have displayed great timing in the past when it comes to investing. We previously reported in June 2020 when holding company H51 purchased €20 million on shares, with the stock rising 20% by December of the same year.
How Is the Stock Performing Now?
At the time of our last report, the stock price was at around €869 and has risen drastically throughout 2021, reaching a peak of €1245 at the end of September 2021. That’s more than a 43% increase in value.
To better put the significance of Hermes’ rising value into perspective, we can look at how Laurent E. Mommeja’s share value has grown over this period.
He purchased 2,400 shares on 7 December 2021 when RMS was valued at around €831, which has seen a 50% increase in value.
Hermes upward momentum in value can be attributed to both an in-store sales rebound after the COVID-19 pandemic, and a result of increased focus on online sales. Those insider purchases had the foresight and information to buy shares at the right time, supporting our assessment in December that this was a bullish signal.
For more retrospectives on 2iQ’s insider buying reports, check out the 2iQ blog.