Cochlear falls on downgrade but those at top buy up large
While some directors of resources-related service companies have been buying discounted shares recently, this week it was the turn of a clutch of directors of Cochlear.
The company issued a downgrade to the effect that earnings would be lower for the second year in a row.
Now, that was not exactly bullish news for a stock that was selling at more than 20 times earnings. Punters reacted accordingly. The shares fell from $64.54 to $52.71 on Monday and, the next day, chief executive Christopher Roberts, chairman Rick Holliday-Smith and non-executive director Andrew Denver all bought stock. They paid between $54.98 and $55.58, and the shares the next day got up to $58.25, before closing the week at $55.65.
Elsewhere on the beaten-up stock front, two directors of drilling concern Boart Longyear joined three of their boardroom colleagues who bought recently. The stock fell 7 per cent on Friday to 66¢.
Among other buyers, Starpharma Holdings boss Jacinth Fairley stepped up. The scrip is at levels last seen in early 2011.
Alan Johnstone - a long-time director at Pental, formerly Symex Holdings - bought shares at just 1.4¢. The soap group, with 1.5 billion shares on issue, is now valued by the market at under $20 million. In its heyday, around 2001, the company was valued at close to $200 million.
Among sellers, Oil Search managing director Peter Botten said he had sold some shares to pay tax that would result from the exercising of performance rights. "This sale in no way signals any change in my confidence that the value of Oil Search shares will continue to grow over the coming years," he said.
The reporter owns COH shares.
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