Top executives inside Cemex Holdings Philippines, Inc. (CHP) on October 9, 2020 bought shares of their company Cemex Holdings Philippines. The President & CEO together with his Vice Presidents for Commercial (Institutional Segment), for Planning and Administration, for Supply Chain, for Commercial (Distribution Segment), and his Procurement Director on the same date bought shares of their employers. Those executives buying shares of CHP are all thought to be expats.
It is not usual for top executives of companies to agree to buy shares of their employers on the same day. It is highly unlikely that those executives took-money out of their pocket and agreed to buy the shares of their employer, CHP, on that same day. This only suggests that those executives may have opted to be paid in CHP shares. It is not uncommon for executives to receive a portion of their compensation in shares of their employer especially if the executives believe that they can cash out later the shares at a higher valuation.
It could not also be believable that they took the company shares because the company has managed to turn-around its financial health especially in this time of the pandemic. Business activities despite the easing of the lockdowns remain subdued. Thus, it could not be expected that CHP’s financials have turned a corner.
The buyings of the insiders in CHP, the parent company Cemex amassing CHP shares, BDO easing loan-covenants of CHP, Big Boy Sy raising funds, a reporter blurting out a rumored SM acquisition, and Sysmart Corporation taking direct shareholdings in CHP – all these taken together paints a transaction in the offing.
If those executives took those CHP shares at 1.55 to 1.57 level, it is believed that those executives expect hefty rewards for those shares far greater than what it costs them.
It is just an analysis that a deal for CHP is in the making. A big risk exists that there could be a no deal or if there is, the transaction price does not provide a premium to the present value of the shares.
Disclaimer and Disclosure: This is an independent analysis for discussion purposes with the aim of giving stock traders and investors an independent view point. Accuretti Systems Inc. in the course of day to day trading may have own, or is considering buying or disposing, the shares of the companies mentioned in this commentary.
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