2iQ Insider Brief: Tryg AS (TRYG: DC) M&G Group (MNG:LN) Nordic Entertainment Group AB (NENTB: SS)

Kaloyan Kolev 1 November 2019

Tryg AS (TRYG: DC)

 12-month performance: +20%
Insider activity: Bullish
Buying pattern: Purchases from multiple directors
Recent news: Solid Q3 results

 

 

Tryg is a Danish insurance company that offers insurance products for the private, commercial and corporate markets. With activities in Denmark, Norway and Sweden, and over three million customers, the group is one of the largest non-life insurance companies in the Nordic region. The stock is listed on the OMX Nordic Exchange Copenhagen and currently has a market capitalisation of DKK 56.2 billion.

We last covered Tryg in late January when the stock was trading near DKK 170. At the time, we said that, in our view, the outlook for the stock was “favourable” due to the fact that three insiders, including the CEO, COO, and the Chief Commercial Officer, had just purchased a substantial number of shares. Following this insider money could have resulted in a profitable trade, as since our January report the shares have climbed as high as DKK 226.

TRYG_DCSource: 2iQ Research

In recent months Tryg shares have pulled back to the DKK 185 level after third-quarter results missed expectations and we think this has created another buying opportunity. We say this because in the last few weeks we have observed share purchases from three members of the supervisory board, including Deputy Chairman Torben Nielsen. Given that multiple insiders are capitalising on Tryg’s recent share price weakness by adding to their share holdings, we think the stock offers an attractive risk/reward proposition right now.

 

M&G Group (MNG: LN)

 12-month performance: N/A
Insider activity: Bullish
Buying pattern: Purchases from multiple directors including CEO, CFO and Chairman
Recent news: Recently demerged from Prudential

 

 

M&G is a UK-based savings and investment company that serves both individuals and institutional investors. Operating in 28 markets, the group serves around 5.5 million retail customers and over 800 institutional clients. The stock is listed on the London Stock Exchange and currently has a market capitalisation of £5.7 billion.

 

On 21 October, M&G completed its demerger from Prudential and joined the FTSE 100 index. The reason the two companies separated is that Prudential decided last year that a demerger would enable both businesses to maximise their potential performance. Since the demerger, M&G’s share price has fluctuated between 201p and 228p. However, it’s worth noting that JP Morgan, who recently initiated coverage of the stock with an ‘overweight’ rating, has a price target of 271p.

 

Looking at insider transaction activity, we think the stock has the potential to move higher. We say this because since the company’s demerger a number of M&G directors have purchased shares including the CEO, CFO, CIO, and the Chairman. Between them, these four directors have spent around £530,000 on M&G shares. Given that these insiders are likely to have a good understanding of the company’s future potential, we see their purchases as a bullish signal.

 

Nordic Entertainment Group AB (NENTB: SS)

 12-month performance: N/A
Insider activity: Bullish
Buying pattern: Purchase from CEO at higher price
Recent news: Announced deal with Telenor

 

 

Nordic Entertainment Group is a Swedish entertainment company that provides broadcast television and streaming services throughout Scandinavia. The group operates satellite TV platforms, TV channels, and video streaming services and also creates and distributes TV shows, commercials, feature films, and branded content. The stock is listed on the Stockholm Stock Exchange and currently has a market capitalisation of SEK 18.4 billion.

 

We last covered Nordic Entertainment Group in late-May when the stock was trading just under SEK 250. At the time, the company had just issued a solid set of first-quarter results and announced a maiden dividend, and we noticed that CEO Anders Jensen and CFO Gabriel Catrina were buying shares. Given this bullish insider buying, we said that, in our view, the outlook for the stock was “favourable.” Fast forward to today, and Nordic Entertainment Group shares trade at SEK 273 – a rise of around 10% since our last report – after the stock surged last week on the back of an announcement that the group will merge its Viasat Consumer unit with Telenor’s Canal Digital unit to form a major regional TV distribution company. The new business is expected to yield significant annual cost cuts. 

NENTB_SSSource: 2iQ Research

Looking at insider transaction activity, we think it’s interesting that CEO Anders Jensen has purchased another 3,600 shares in Nordic Entertainment Group in the last week at a share price of SEK 287. This suggests that, despite the recent share price spike, the insider still sees the stock as undervalued. Given that a company’s CEO tends to have more information in relation to that company’s future prospects than anyone else, we view his purchase as a bullish signal. As such, we think the outlook for the stock remains favourable.

Disclaimer: Neither 2iQ Research GmbH nor its content providers are responsible for any damages or losses arising from any use of this information.

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