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When board directors spend bucketloads of their own money buying more ASX shares in the companies they run, it’s a pretty clear sign of confidence.
To reiterate, we’re not talking about the exercising of options or rights issues. Nor director’s remuneration (where the issuing of new shares forms part of a director’s salary package). We’re talking about on-market trades using personal cash savings, super funds, or monies held within companies they own or control.
Who’s been buying shares in the ASX companies they run?
Listed companies are required to publicly advise the ASX when a director has purchased shares.
In a statement this week, Straker Translations Ltd (ASX: STG) told the ASX that director Steve Donovan had acquired 40,000 shares in an on-market trade worth more than $1.7 million on 3 August.
On Friday, the Straker share price closed at $1.13, up 7.1% for the day and down 29.4% year to date.
Eagers Automotive Ltd (ASX: APE) director Nicholas Politis AM has also made a series of share purchases through his companies, WFM Motors Pty Ltd and NGP Investments (No 2) Pty Ltd.
Politis has been buying more ASX shares in Eagers for several weeks. In July, I spent $1.5 million buying Eagers shares. By the end of the month, I have held more than 70.33 million shares.
He’s bought another 100,000 Eagers shares in August, the latest being a 10,000 parcel bought on Thursday.
On Friday, Eagers closed at $13.10, making his stake in the ASX 200 company worth about $922 million.
Eagers has a market capitalization of $3.47 billion with approximately 257 million shares on issue.
The Eagers share price dipped 3.1% on Friday and is down 6.1% year to date.
Also this week, United Malt Group Ltd (ASX:UMG) told the ASX that three directors had bought shares.
Independent chair and non-executive director Graham Bradley AM purchased 75,000 shares on the ASX between 3 and 8 August. The average price was $3.04 per share for a total consideration of $227,994. He now directly owns 196,395 shares in the company.
United Malt CEO and managing director Mark Palmquist purchased 50,000 shares on 4 August at an average price of $2.95 per share for a total consideration of $147,625. He now directly owns 543,222 shares in the company.
Independent non-executive director Gary Mize purchased 17,317 shares on 4 August at an average price of $2.85 per share for a total consideration of $49,353. He now owns 48,200 shares in the company.
The United Malt share price closed Friday’s session at $3.29, up 1.9%. It’s down 27.2% year to date.