Boss spends £31k on stock, echoing similar purchase by deputy chairman last month
Shares in UK electrical component firm Volex surged by nearly 9 per cent in midday trading today [14th March 2013], driven by CEO Ray Walsh’s decision to spend around £31,000 of his own cash on buying stock.
Volex’s shares had been stumbling along on a near low of 97 pence before Walsh swooped, acquiring 32,286 shares and taking his holding to a quarter of a million shares. Within a few hours Volex’s price had risen to around 104 pence as investors followed Walsh’s lead.
In recent months the Paddington, London-based manufacturer has had a rocky ride, having been badly hit in December by Apple’s decision to source elsewhere for its new iPhone ‘Lighting’ cable. Soon afterwards it issued a profit alert, wiping a third off its value.
Then, last month, analysts at Canaccord Genuity dropped their target price on its stock to 97 pence – the point at which Walsh started buying.
But the Volex CEO is no stranger to ducking and diving when it comes to the company’s shares. In November he netted around £476,000 after selling some 326,000 shares at around £1.46 each.
A statement from the company later revealed that the CEO, as an American taxpayer, was legally obliged to exercise long term share options before the end of 2012 and had used part of the sale proceeds to acquire 469,297 ordinary shares for £137,949 – purchasing 37,500 at 80p and 431,797 at 25p respectively.
Last month Karen Slatford, Volex’s deputy chairman, also purchased 30,000 ordinary shares at a price of 99 pence.