It is perhaps a sign of his confidence that, on the very same day that Sir David Walker formally took over from Marcus Agius as Barclays' chairman, he also decided to spend £115,095 buying 50,000 of the bank's shares. But that confidence could yet prove too bullish.
After all, Barclays' share price has already risen by more than 50 per cent since the latter part of July. And with a sea of challenges still ahead, those gains could easily be lost. To begin with, Barclays (BARC) recently revealed a £47m pre-tax loss for the third quarter of the year - not helped by a chunky £700m of extra provisioning against payment protection claims. And, following on from this summer's Libor-fixing scandal, further reputational woe could be on the horizon.
Barclays is being investigated by the UK’s FSA and Serious Fraud Office, as well as the US Department of Justice, over payments to Qatari investors after it raised funds from the Gulf state. A $470m (£292m) fine from US electricity regulators could also be possible after being accused of manipulating the California energy market. The bank’s significant exposure to such struggling eurozone countries as Spain and Italy is a worry, too. What's more, Barclays’ reliance on weak retail banking markets and volatile investment banking conditions do not bode well for earnings growth.
John Adams
Jones pockets more cash
Smiths Group (SMIN) has been a steady performer since September’s encouraging final results. Although much of the restructuring work is done, there are extra savings to come at the detection unit, while new products, especially at the medical division, are driving top line growth. It’s doing more business in fast growing emerging markets, too.
However, head of IT Brian Jones has seen enough. He’s just pocketed more than £100,000 after selling 10,000 shares at 1,069p. It’s not the first time Mr Jones, who worked with chief executive Philip Bowman at both Scottish Power and Allied Domecq, has cashed in. He sold over 1,900 shares at 1,059p in April and another 10,000 at 900p in December last year. More importantly, finance director Peter Turner spent over £94,000 on shares last month.
True, Smiths makes around 20 per cent of its sales from the US public sector, so budget sequestration adds uncertainty. Yet, unemployment there is falling, which usually means increased hospital admissions and, according to broker Nomura, could drive an earnings beat at the medical unit next year. Higher bond yields may also clear the pension fund’s accounting deficit making disposals more likely.
At 1,081p, Smiths shares are up on our buy tip (1,020p, 24 May 2012), and, with impressive margins and respectable earnings growth, we leave our rating unchanged.
Lee Wild
Director buys
Company | Director | Date | No. of shares | Price (p) | Value (£) |
---|---|---|---|---|---|
Alkane Energy | Roger McDowell (ch) | 05 Nov 12 | 50,000 | 24.5 | 12,250 |
Avocet Mining | Russell Edey (ch) | 05 Nov 12 | 100,000 | 63.75 | 63,750 |
Barclays | Sir David Walker (ch) | 01 Nov 12 | 50,000 | 230.19 | 115,095 |
China ChainTek United | William Knight (ch) | 30 Oct 12 | 3,500 | 225 | 7,875 |
dotDigital | Peter Simmonds | 05 Nov 12 | 38,187 | 12.99 | 4,960 |
Hydrodec | Chris Ellis (cfo) | 30 Oct 12 | 447,849 | 10.75 | 48,144 |
Hydrodec | Colin Moynihan (ch) | 02 Nov 12 | 790,000 | 12.5 | 98,750 |
Lok'nStore | Richard Holmes | 30 Oct 12 | 12,000 | 119.5 | 14,340 |
Low & Bonar | Steve Good | 01 Nov 12 | 14,100 | 32.18 | 4,537 |
One Media iP | Nigel Smethers | 30 Oct 12 | 58,371 | 2 | 1,167 |
Publishing Technology | Alan Moug (cfo) | 31 Oct 12 | 50,176 | 99 | 49,674 |
Quintain Estates & Devpt | William Rucker | 31 Oct 12 | 5,607 | 53.5 | 3,000 |
Spectra Systems | Dr Nabil Lawandy (ceo) | 31 Oct 12 | 25,000 | 40 | 10,000 |
Stanley Gibbon | John Byfield | 31 Oct 12 | 7,050 | 210 | 14,805 |
Stanley Gibbon | Martin Braisford | 31 Oct 12 | 12,500 | 211.9286 | 26,491 |
Telecity | Michael Tobin (ceo) | 05 Nov 12 | 2,000 | 843.6 | 16,872 |
Telecity | Michael Tobin (ceo) | 05 Nov 12 | 1,000 | 814.5 | 8,145 |
Whitbread | Susan Hooper | 05 Nov 12 | 800 | 2412.9 | 19,303 |
Wolfson Microelectronis | Robert Eckelmann | 31 Oct 12 | 10,000 | 211 | 21,100 |
Director sells
Company | Director | Date | No. of shares | Price (p) | Value (£) |
---|---|---|---|---|---|
Aggreko | Bill Caplan | 30 Oct 12 | 1,000 | 212.50 | 2,125 |
Arden Partners | Jonathan Keeling | 05 Nov 12 | 25,000 | 50 | 12,500 |
Hongkong Land | Robert Garman | 01 Nov 12 | 5,000 | US$6.44 | US$32,200 |
M.P. Evans | JD Shaw | 25 Oct 12 | 1,207 | 500 | 6,035 |
M.P. Evans | JD Shaw | 29 Oct 12 | 3,793 | 495 | 18,775 |
M.P. Evans | JD Shaw | 30 Oct 12 | 5,000 | 498 | 24,900 |
Rugby Estates | Andrew Wilson (ceo) | 05 Nov 12 | 456 | 330 | 1,505 |
Smiths Group | John Fawcett Jones | 05 Nov 12 | 10,000 | 1,069.43 | 106,943 |
Table compiled by Robert Ansted.
Key to abbreviations: ch = chairman; ce = chief executive; cfo = chief financial officer; fd = finance director; coo = chief operating officer; cs =company secretary; md = managing director