Self Storage Group ASA engages in the operation and rental of self storage units to private individuals and businesses in Norway, Sweden, and Denmark. Self Storage Group is one of Norway’s large-cap stocks that saw some insider buying over the past three months, with insiders investing in 68.00k shares during this period. Generally, insiders buying more shares in their own firm sends a bullish signal. A research published in The MIT Press (1998) concluded that stocks following insider buying outperformed the market by 4.5%. However, it may not be sufficient to base your investment decision merely on these signals. Today we will evaluate whether these decisions are bolstered by analysts’ expectations of future growth as well as recent share price movements.
Who Are The Insiders?
There were more Self Storage Group insiders that have bought shares than those that have sold. In total, individual insiders own over 3.93 million shares in the business, which makes up around 5.98% of total shares outstanding. Insiders that have recently bought more shares are: Bente Myhre (management) and Cecilie Hekneby (management) This statement is created if only one individual insider bought company shares in past 3 months .
Does Buying Activity Reflect Future Growth?
At first glance, analysts’ earnings expectations of 36.7% over the next three years illustrates an upbeat outlook going forward which is consistent with the signal company insiders are sending with their net buying activity. Delving deeper into the line items, Self Storage Group is expected to experience a healthy double-digit top-line growth next year, which has not been passed down into earnings expectations given its negative growth rate of -2.0%. This means cost growth is anticipated to outstrip revenues, indicating a period of investment and growth in the company. Insiders’ net buying activities seem to support the idea of growth moving forward. Or they may simply view the current share price as too low relative to its intrinsic value.
Did Insiders Buy On Share Price Volatility?
Another factor we should consider is whether the timing of these insider transactions coincide with any significant share price movements. Volatility provides an opportunity to trade on market inefficiencies when the stock is under-priced compared to the stock’s intrinsic value. Self Storage Group’s shares ranged between NOK16.8 and NOK15.25 over the past three months. This suggests a relatively insignificant share price movement, with a small change of 10.16%. Perhaps not a significant enough movement to warrant transactions, thus motivation may be a result of their belief in the company in the future or simply personal portfolio rebalancing.
Self Storage Group’s net buying tells us the stock is in favour with some insiders, though negative growth in expected earnings contests this assumption, and the relatively stable stock price may not warrant exploiting any mispricing. Although insider buying can be a useful prompt, following the lead of an insider, however, will never replace diligent research. I’ve compiled two relevant aspects you should further research:
- Financial Health: Does Self Storage Group have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
- Other High Quality Alternatives : Are there other high quality stocks you could be holding instead of Self Storage Group? Explore our interactive list of high quality stocks to get an idea of what else is out there you may be missing!
NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at firstname.lastname@example.org.