12-month performance: -15% Insider activity: Bullish Buying pattern: Purchase from CEO Recent news: Solid trading update
Mondi is a UK-based packaging and paper company that has a focus on sustainability. The company is the number one producer of virgin container board in Europe, as well as the number one producer of paper bags. It is listed on the London Stock Exchange and currently has a market capitalisation of £7.2 billion.
Mondi’s most recent Covid-19 update, issued on 9 April, was quite encouraging. The company said that its order books had held up well in the first quarter, and that it had delivered a robust performance for the quarter that was in line with expectations. In terms of its capital position, the company advised that it had a strong liquidity position of around €1.5 billion, and that at 31 December 2019, its net debt to underlying EBITDA ratio was 1.3 times. “Mondi is a resilient business offering packaging and other products for daily consumer needs, and delivering essential services to the communities around its larger operations. The group is financially strong with a robust liquidity position and capital structure,” said CEO Andrew King.
Source : 2iQ Research
What looks interesting here is the fact that in late June, Mr King, the CEO, increased his stake in Mondi significantly. On 29 June, the insider purchased 15,000 Mondi shares at a price of £14.96 per share, boosting his holding in the packaging company from 7,671 shares to 22,671 shares. We see this purchase, which cost the insider approximately £224,400, as a bullish signal. It suggests that King is confident about the future and that he sees the stock is undervalued at present.
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