Big Director Buys At Quindell PLC
Up until recently, Quindell’s shares had more than quadrupled in the space of 12 months to reach an all time high of 44p. However, this AIM-listed insurance technology company took a massive hit last week when a report published by a US group called Gotham City Research claimed the business was “built on sand”, and that the shares were worth just 3p. Quindell responded by issuing a rebuttal of Gotham’s damning allegations and conclusions, and by initiating legal action against those responsible for what it called “this coordinated shorting attack”.
This week, all the members of Quindell’s board of directors have backed up their vocal indignation by putting their money where their mouths are.
On Monday, founder and chairman Robert Terry splashed out £95,000 to buy 500,000 shares at 19p a time, and was joined by the company’s five non-execs who invested a combined £84,000 at 19p-20p a share. Finance director Laurence Moorse joined in on Tuesday with a £20,000 buy at 20p. But Robert Fielding, the below-board-level boss of Quindell’s services division, was a little late to the party, and had to pay 25.4p a share when making a £50,000 investment yesterday.
Quindell’s shares are trading at around 25p at the time of writing. That represents less than seven times current-year forecast earnings. However, one of Gotham’s central points is that while Quindell is reporting supersonic annual earnings increases, cash flow is negative. |
