Corporate insiders have deep insight into their companies’ operations. Therefore, their stock trading activity can provide investors with valuable insights.

In this report, we are going to highlight some interesting legal insider trading activities at Eni SpA (ENI:IM). Eni is an integrated energy company that is active at every stage of the value chain. It produces both traditional fossil fuel energy and renewable energy. The company is listed on the Borsa Italiana and currently has a market cap of €47.73 billion.

Insider Buying at Eni Spa

2iQ data shows that on January 16, Stefano Speroni, Director of Legal Affairs and Commercial Negotiations, purchased 16,000 ENI shares at a price of €14.53 per share. This trade cost the insider approximately €251,553 and increased his holding to 34,144 shares.

Large Purchase

This trade is worth highlighting for a couple of reasons.

Firstly, the trade has increased the size of Mr. Speroni’s stock holding by nearly 90%. The fact that the insider has boosted his position by such a large percentage suggests that he is very confident the stock is set to move higher.

Secondly, Mr. Speroni has vast experience in the areas of capital markets, private equity operations, and mergers and acquisitions. Previously, he was a Managing Partner for Corporate M&A in Dentons’ Italian practice. Given his background, he is likely to have a good understanding of Eni’s financials.

Strong Q3 Results

Eni’s most recent results, for the third quarter of 2022, were strong.

For the quarter, net cash from operations totaled €5,586 million, compared to €2,933 million a year earlier. Adjusted net profit came in at €3,730 million versus €1,431 million in Q3 2021.

As a result of this solid performance, the company was able to strengthen its balance sheet significantly, ending the quarter with net borrowings of €6,444 million compared to €11,309 million a year earlier.

On the renewable energy front, it can be noted that Eni is achieving new milestones. It said that by the end of 2022, it is expected to have doubled its installed capacity to more than 2 GW.

Since these results, analysts at Credit Suisse have initiated coverage of the stock with an outperform rating and €20 price target. That implies an upside of nearly 40% from current levels.

In light of these developments, we see the insider trade here as a bullish signal.

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