Watch this one – Big inside trades at Jamaica Broilers

Investors should be keenly watching development at Jamaica Broilers. The company recently, advised the Jamaica Stock Exchange that senior management and directors purchased a total of 7,854,620 shares on August 15 and a Director purchased 237,500 shares on August 14, 2014.
The total cost of these trades would be in the order of $36.5 million. More significantly, there has not been any trade of this magnitude for years by insiders.
The trades may be carrying coded messages to the wider investing public as to what may be happening to profit. On July 30, this year, a director sold 500,000 shares, and a director purchased 574,651 of the company’s shares on March 28 and back in 2013 a related party sold 1,500,000 of the company’s shares to another related party on November 14.
A check with the Jamaica Stock Exchange shows the only other year recently that there was major trading in the stock by insiders was back in 2012, when seven Senior Managers purchased a total of 8,774,697 of the group’s shares on September 14.
The other times of major buying of the stock by managers and directors, was between April 2006 and April 2008. The trades in late 2007 triggered some outcry by investors which led to the company making a public statement in connection with the trades.
At the time of major trading of the shares by insiders in 2007, the company released a report to the Jamaica Stock Exchange around October 4, which stated that “Shares in Jamaica Broilers Group were traded by some directors and senior management in September 2007 during the time window which is allowed by the Jamaica Stock Exchange providing there is no material event requiring disclosure. We wish to State unequivocally that, when these shares were traded, there were no inside knowledge of any circumstances that were no available to the general public.
When these trades took place the company was of the view that – based on a sale contract with affixed selling price – good results would have been realised for the second quarter, irrespective of the reduction in world market prices for fuel graded ethanol.”
IC Insider projects that profits for the current year should hit a record $1.25 per share or $1.5 billion up from 79 cents per share or $950 million for the year to April 2013. The next set of results are due around the 8 of September and will be for the first quarter to July.