At the end of each week I like to look at which shares have experienced insider buying.
This is because insider buying is generally seen as a bullish indicator as few know a company, its industry, prospects, and true value better than its own directors.
Three shares which have reported meaningful insider buying recently are listed below:
GUD Holdings Limited (ASX: GUD)
According to a change of director's interest notice, this conglomerate's chairman Mark Smith has picked up a total of 8,000 shares through a series of on-market trades over the last few days. The total consideration was $120,460 or approximately $15.06 per share. This follows a purchase made by Mr Smith at the start of the month, which I feel is an indication that this director has a lot of confidence in the company's long-term prospects.
Neuren Pharmaceuticals Ltd (ASX: NEU)
Two change of director's interest notices reveal that non-executive directors Dr Jenny Harry and Patrick Davies have dipped into the market over the last few days. Dr Harry picked up 14,084 shares through an on-market trade for a total consideration of $20,584, whereas Mr Davies snapped up a sizeable 69,646 shares through a series of on-market trades for a total consideration of $100,001. This meant the two directors paid an average price of $1.46 and $1.44 per share, respectively. With Neuren Pharmaceuticals' shares down significantly from their 52-week high of $3.60, it appears both directors see a lot of value in them at this level. Though, this hasn't been enough to support its share price this week. The company's shares are down 12% to $1.32 week-to-date.
Praemium Ltd (ASX: PPS)
According to a change of director's interest notice, this fintech company's chairman Barry Lewin picked up a large number of shares on Tuesday. The notice shows that Mr Lewin bought 100,000 shares through an on-market trade for an average price of 90.65 cents per share or a total consideration of $90,650. On Monday Praemium reported its full-year results which revealed a 22% increase in revenue and other income to $43.2 million and a 40% jump in underlying EBITDA to $8.8 million. A 35% increase in funds under administration to $8.3 billion drove the strong result. Judging by his purchase, Mr Lewin appears to be confident that FY 2019 will be another positive year for the fast-growing company.
