Weekly insiders #3

06/03/23 - 10/03/23

Mar 14, 2023

Good morning Micro Investors!

Welcome to Weekly Insiders, a report of the insider movements in the micro cap universe. Insider buys are often a sign of management real forecast of company future and can be indicators of special situations.

I review insider movements in unknown and illiquid micro caps in Europe and Australia, so you don’t have to.

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Insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.

-Peter Lynch

Summary

Unlike past weeks, where most of the transactions were made on fish farming and offshore companies, many of the insider purchases are in companies still developing products. These companies are yet still to achieve profitability and trade at healthy multiples. They fall in the too hard pile for me, but may be adequate for someone willing to do the work, insiders trust is a good first step.

I really like a couple companies which are trading at a deep discount to book value.

This is the case for Nivika Fastigheter AB (NIVI B), real state holding trading at 0.5x BV and Mercator Medical S.A. (MRC), a glove manufacturing business with a huge handover from covid but a bigger pile of cash.

In the pile of wonderful business we have Nimbus Group AB (BOAT), a small yacht manufacturer growing and trading at less than 6x P/E.

Insider transactions

Norway:

Horisont Energi AS (HRGI) (Market Cap: $21M) - Chief Legal Officer purchase of 12000 shares at a price of 9,9 NOK, for a total of $11K. Horisont Energi AS engages in the production of blue hydrogen and blue ammonia in Norway. The company has about. The company has no income, but had $40M in cash in Q3 ‘22, involved in multiple projects this year.

[TREND] - Zwipe AS (ZWIPE) (Market Cap: $17M) - Board members purchase of 61000 shares at a price of 4,8 NOK, for a total of $27K. Zwipe AS provides biometric payment cards components and wearables technology that enable consumers to authorize transactions with their fingerprints. The company has no income, but their solution got approved by Mastercard in Q3 ‘22.

Lumi Gruppen AS (LUMI) (Market Cap: $57M) - Insider purchase of 110000 shares at a price of 10,5 NOK, for a total of $109K. The company provides online courses and operates private schools. The company has a high level of debt and trades at P/E 16.

Nordhealth AS (NORDH) (Market Cap: $163M) - CEO purchase of 3300000 shares at a price of 20 NOK, for a total of $6249K. The company designs and provides ERP solution for medical and veterinary clinics. About $30M in revenue and still losing money.

Sweden:

Free2move Holding AB (F2M) (Market Cap: $1M) - Insider purchase of 381000 shares at a price of 0,21 SEK, for a total of $7K. Digital solutions for facility management. 400% revenue growth in ‘22, still losing money.

Nivika Fastigheter AB (NIVI B) (Market Cap: $207M) - purchase of 33000 shares at a price of 43,5 SEK, for a total of $135K. Nivika Fastigheter AB (publ), a real estate company, acquires, develops, refines, and manages residential and commercial properties in Sweden. Trading at 0.5x tangible book value.

Nimbus Group AB (BOAT) (Market Cap: $82M) - Insider purchase of 424000 shares at a price of 41 SEK, for a total of $1639K. Companies manufactures yachts. Sales x4 from ‘18, trading at P/E 5.7x

Australia:

CountPlus Limited (CUP) (Market Cap: $44M) - Directors purchase of 160000 shares at a price of 0,55 AUD, for a total of $58K. Company provides accounting, business advisory, and financial planning services in Australia. Revenues and margins under pressure from ‘18, P/E 12 but much less if the recover past margins.

Coventry Group Ltd (CYG) (Market Cap: $64M) - Director purchase of 95000 shares at a price of 1,03 AUD, for a total of $65K. Coventry Group Ltd primarily distributes industrial products in Australia and New Zealand. Healthy multiple, at about P/E 20.

MotorCycle Holdings Limited (MTO) (Market Cap: $81M) - Insider purchase of 311000 shares at a price of 1,67 AUD, for a total of $346K. Company owns and operates motorcycle dealerships in Australia. P/E 5.5x but margins increased from ‘21, about half before, this is key to review.

European Lithium Limited (EUR) (Market Cap: $72M) - Directors purchase of 25000000 shares at a price of 0,07 AUD, for a total of $1166K. The company is developing a lithium mine in Germany. The company presented a report valuing the mine in $1.6B, still to be developed in ‘26.

Switzerland:

Phoenix Mecano AG (PM) (Market Cap: $409M) - CEO purchase of 232 shares at a price of 390 CHF, for a total of $99K. The company manufactures and sells components for industrial customers. P/E 12x

Poland:

Silvair, Inc. (SVRS) (Market Cap: $16M) - Director purchase of 15000 shares at a price of 4,6 PLN, for a total of $15K. Company develops software solutions for IOT.

Mercator Medical S.A. (MRC) (Market Cap: $112M) - Owner purchase of 221000 shares at a price of 48 PLN, for a total of $2431K. Company manufactures and sells medical gloves. Company trading at half book value, being most of it cash.

TenderHut S.A. (THG) (Market Cap: $18M) - CEO purchase of 600 shares at a price of 41 PLN, for a total of $5K. Company provides software development services and IT integration. Review of the company here: