This ASX All Ordinaries stock is down 40% in a year, and the chair is buying up big

Over the past three months, he's spent more than half a million dollars of his own money buying more Humm shares.

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Key points

  • The chair of ASX All Ordinaries stock Humm Group appears to be taking advantage of his company's share price slump
  • The Humm share price is down 40% over the past 12 months 
  • Over the past three months, Andrew Abercrombie has spent more than half a million dollars of his own money buying more Humm shares

The chair of ASX All Ordinaries stock Humm Group Ltd (ASX: HUM) appears to be taking advantage of his company's share price slump.

The buy now, pay later (BNPL) share is down 2.04% today to 48 cents. This is broadly in line with the S&P/ASX All Ordinaries Index (ASX: XAO), which is down 1.77% today.

But the performance of the stock and its index diverge significantly when we look at the past 12 months.

The ASX All Ordinaries stock has lost 40% of its value while the All Ords has dropped by just 3.2%.

While this has, no doubt, disappointed shareholders, founding director and chair Andrew Abercrombie appears to see an opportunity for some dollar-cost averaging.

Let's investigate.

Buying the dip on this ASX All Ordinaries stock?

A series of notices lodged with the ASX since the start of March reveal that Abercrombie made five on-market purchases of Humm shares through his super fund between 28 February and 7 March.

In total, Abercrombie spent just over $407,000 including brokerage fees purchasing 815,329 Humm shares.

This latest spending spree follows another that Abercrombie undertook in December when he made four other on-market purchases through this super fund.

The chair spent just over $174,000 on 319,453 shares that month.

He now holds almost 118.5 million shares in this ASX All Ordinaries stock.

Abercrombie isn't the only Humm director buying shares in recent times either.

This indicates to investors that the people running the BNPL business are very confident in its future.

How is the Humm business going?

In its 1H FY23 results, Humm reported a 20% increase in total volumes to $2 billion and a statutory net profit after tax (NPAT) of $7.5 million.

This was a vast improvement on the $168.3 million loss reported in 1H FY22.

The company said it had a strong balance sheet with $103 million in unrestricted cash.

The ASX All Ordinaries stock will pay a fully franked interim dividend of 1 cent per share on 11 April.

Motley Fool contributor Bronwyn Allen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Humm Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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