Oil bull trend about to resume?
Simon Laffin has been the most prolific post rights purchaser, opening his cheque book no fewer than 6 occasions since being made Non-Exec Chairman in August 2011. He has built up from nothing a stake of 1.2m shares at an average price of just over 30p - a net injection of approximately ÂŁ360k - no small sum and one worth considering in the bigger picture. The other notable Directors purchases were a ÂŁ50k investment by David Richardson at 29.5p in January 2012 and a large purchase of 1.5m shares by Graham Roberts at 30p - a ÂŁ450k ticket and who replaced Nigel Rawlings as CEO at the end of March this year.
The only concerning element of the Assura story is the overhang of the rump 20m shares from the rights issue - a look at the chart below does not display the volume that would indicate they have been absorbed by the market - this could be either due to the underwriters being happy to hold the stock or there has not been sufficient institutional demand there to unload. If the latter is the reason, then any further price appreciation in the stock is likely to be capped as Cenkos & Investec look to release back capital.
Assura Group weekly chart
A look at the weekly chart above displays a constructive picture with a double bottom in place at 27p, a downtrend line break in recent weeks and the 10 week moving average turning up. In short, in unison with an underpinned NAV, the plethora of meaningful Directors purchasing of late and, of not insignificant sums, the stock looks to be an interesting medium term play to us.
July 2012 | www.financial-spread-betting.com | 111