Insider: six stocks backed by directors to go higher

Heavy selling of mid-caps Kier Group (LSE:KIE), discoverIE Group (LSE:DSCV) and Coats Group (LSE:COA) has triggered a strong boardroom response after directors spent £350,000 on their respective shares.

In a busy week for insider purchases in the FTSE 250 index, the new chair of Ocado Group (LSE:OCDO) spent £225,000 on his technology firm’s lowly shares and the recently appointed chief executive of drinks group C&C Group (LSE:CCR) invested £120,000.

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The director buying, which also included a £75,000 stake in Oxford Nanopore Technologies (LSE:ONT), follows double-digit percentage declines for all six companies in 2025.

Kier shares are down 15% so far this year, including Tuesday's 13% results-day slide amid disappointment the construction services firm did not upgrade full-year guidance.

The reverse came even though chief executive Andrew Davies said an £11 billion order book gave good multi-year visibility, boosted by the UK’s infrastructure spending commitments.

A big jump in net cash to £57.9 million means shareholders can expect a 20% increase in dividend to 2p on 2 June. An initial £20 million buyback of shares was launched in January.

Panmure Liberum said the results were further evidence that Kier is in good shape, adding that a price/earnings (PE) multiple of 6.4 times is a 50% discount to its peers.

The broker has a price target of 250p, while Deutsche Numis values the shares at 235p and Peel Hunt at 200p after calling Kier a “compelling proposition” and key sector pick.

The shares topped 150p last summer and again in February, having rallied from 2020’s 43p on the back of three years of operational and debt reduction progress.

Last week’s purchases by four non-executives, including the chair Matthew Lester, took place after the results and were priced at about 124p for a total outlay of £67,000.

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The boardroom support for the shares of Coats followed a negative run for shares since annual results on 6 March, even though the industrial threads business increased its final dividend by 10% and unveiled new medium-term targets.

These included average organic revenue growth of at least 5% and a margin of 19-21%, up from 2024’s improved 18%. It expects to generate more than £750 million of adjusted free cash flow over the next five years.

Continued outperformance against the industry in apparel and footwear meant revenues rose 9% at constant exchange rates and earnings per share lifted 18% to 9.5 US cents.

Peel Hunt said: “Coats continues to take market share, grow sustainable products, and has set a clear vision for profits and cash delivery. The rating is compelling for a market leader with strong growth drivers.”

The broker has a price target of 125p, which compares with Friday’s level of 82p after a 13% fall for shares so far in 2025. Their reverse from more than 100p in September has been driven by global economic uncertainty, as well as this month’s forecast of only modest growth in performance materials.

Chief executive David Paja, whose strategic focus has turned to generating “sustainable growth at compelling returns”, last week spent £125,000 on shares at a price of 83p. Non-executive director Sarah Highfield also made an investment worth £50,000.

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The economic outlook and the potential impact of US tariffs have also hindered the shares of discoverIE, with the customised industrial electronics firm down by about a fifth so far in 2025 at its lowest level in nearly five years.

That’s despite the company reiterating expectations in its third-quarter update at the end of January, when a top-line fall of 3% represented an improvement on the declines of 7% and 12% in the previous two quarters.

The order book increased by 4%, representing the first quarter of growth since the September 2022 peak, while the company reported continued margin progress. It added that it “is well positioned to deliver sustained growth as markets recover”.

Chair Bruce Thompson bought shares worth £65,000 last week at a price of 544p, while the long-serving finance boss Simon Gibbins made an investment worth £50,000 at 547p.

Deutsche Numis, which had a price target of 765p after the recent update, thinks that the impact of US tariffs on imports from Mexico and China is limited.

It said last month: “About 25% of group sales are in the US, of which we understand about two-thirds is manufactured in-country from components sourced locally.

“Of the remaining 33% we estimate about 15% are manufactured in Mexico and China, with a further 4% manufactured in the EU, and we would expect discoverIE to either pass through any tariffs, move production to other jurisdictions, or a combination of both.

“However, it is too early to tell whether the imposition of tariffs has an impact on broader macro conditions and whether this further defers the expected organic recovery.”

Has Ocado hit the bottom?

Among last week’s other FTSE 250 director purchases, Ocado chair Adam Warby bought the grocery warehouse technology company’s shares at a multi-year low price of 225p.

C&C chief executive Roger White made his purchase on Thursday after shares in the company behind Bulmers and Tennent’s fell 19% on the back of a year-end update.

The drinks firm said softer trading conditions in the hospitality industry in January and February left full-year earnings modestly below target. The performance in the new financial period should be marginally ahead year-on-year, below City forecasts.

Having joined the firm in January, White backed the significant long-term opportunity within the business and said that he is fully focussed on delivering increased shareholder value.

He bought shares at a price of 120.6p, which compares with 175p in May. Non-executive director Angela Bromfield also disclosed an investment worth £20,000 on Friday.

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At Oxford Nanopore Technologies, non-executive director John O’Higgins spent £75,000 increasing his stake at a price of 97.2p.

The shares are down 22% this year, even though the gene sequencing firm continues to expect it will reach a breakeven position in 2027 and become cash flow positive in 2028.

The selling follows downgraded revenues guidance for 2025, with the company now forecasting constant currency growth of 20-23% due to material uncertainty and risk to US National Institutes of Health funding levels.