In this monthly series, we provide a roundup of insiders who have recently raised their stock holdings by a considerable percentage.
Surgalign Holdings Inc, Crown Holdings Inc, and Whitbread PLC were all featured in our August 2021 edition.
Why Should You Track Insider Holding Percentages?
There are multiple facets of insider trading behavior that potential investors can track, such as analyzing how much an insider’s holding increases with a trade.
As an example, three insiders bought shares as part of a cluster and each spent $125,000, with two increasing their holdings by 30% and the third increased theirs by 70%. The 70% increase would be considered more bullish.
The three examples of bullish insider trading below show notable increases in insider holdings.
888 Holdings (888:LN)
888 Holdings is headquartered in Gibraltar, with a number of gambling brands and websites across the world. It currently trades on the London Stock Exchange with a market capitalization of £1.55 billion.
We published a report on 888 Holdings and its insider trading activity in September.
Chairman of the Board at 888 Holdings, Jonathan Mendelsohn, purchased 24,000 shares at a price of £3.91 per share. This purchase cost Mendelsohn around £85,000 on September 9, 2021.
This raised Mendelsohn’s holdings by around 100%, effectively doubling his share holding to approximately 48,000 shares. This purchase indicates his strong confidence in 888.
Verano Holdings Corp (VRNOF:US)
Verano Holdings is a vertically integrated cannabis production company, with a market capitalization of $3.68 billion. In late September, 2iQ Research reported on significant cluster buying activity within Verano.
- Founder and CEO Geroge Archos bought 79,800 VRNOF shares at $12.52. This increased his holdings by about 40%.
- CIO Aaron Miles bought 14,719 VRNOF shares at $12.30. This raised his holdings by around 170%.
- Chief Legal Officer Darren Weiss purchased 14,466 VRNOF at $12.30. This purchase increased his holdings by less than 10%.
Verano’s cluster also included the CFO, a Director and company President making first time VRNOF trades. This is a very bullish buying pattern, with the large cluster demonstrating a consensus opinion within Verano that its stock is undervalued by the market.
Perhaps the best way to illustrate the significance of holding increases is by taking a deeper look at this cluster.
Despite both Aaron Miles and Darren Weiss purchasing over 14,000 VRNOF shares, Aaron Miles drastically increased his holdings of this stock when compared to Weiss. Miles’ trading is the more bullish signal of the two, as it could suggest that now is an interesting time to invest in Verano.
ON Semiconductor Corp (ON:US)
Gregory Waters is a board member for US semiconductor manufacturer ON Semiconductor Corp. On September 7, 2021, Waters purchased 17,000 ON shares at a price of $45.26 per share. This cost the insider around $770,000.
Waters’ September 2021 trade increased his holding to 25,175 ON shares, a 208% increase. The large scale of this trade alone makes it worth reporting, but Waters’ high level of experience in the semiconductor industry suggests that he has a strong understanding of ON Semiconductor’s prospects.
In light of these factors, as well as the strong company performance detailed in our full report, we consider this insider trading at ON Semiconductor Corp to be bullish.
Follow the 2iQ blog for further increased round-ups each month like this.