ASX 200 stock Bapcor Ltd (ASX: BAP) has taken a 21% dive over the past month, which is perhaps one of the reasons why we've seen seven recent insider buys.
An analysis of recent ASX lodgements shows seven out of the eight members of Bapcor's board of directors bought more shares late last week.
This follows a disappointing update delivered at last Tuesday's annual general meeting (AGM).
On the day of the AGM, the Bapcor share price dipped by 11.5% and closed at $5.91.
The ASX 200 stock is currently changing hands for $5.51 apiece, up 0.73% so far on Tuesday.
Meantime, the S&P/ASX 200 Index (ASX: XJO) is up 0.22%.
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7 insider buys on ASX 200 stock
Bapcor lodged a series of notices on Thursday and Friday advising the ASX of changes in the shareholdings of seven of its directors.
All seven of these insider buys took place last Wednesday or Thursday.
Bapcor CEO and managing director Noel Meehan made the biggest purchase of the group, acquiring 35,778 Bapcore shares on-market for $5.5567 per share. He bought through a family superannuation fund and increased his holdings via the fund by 28%.
Kate Spargo was also planning for retirement when she bought 10,000 more shares through her super fund on-market for $5.589 per share. This raised her personal super holdings in Bapcor by 50% to 30,000 shares.
Rebecca Dee-Bradbury joined the Bapcor board on 1 September. She did not hold Bapcor shares before purchasing 10,000 on-market last Wednesday at $5.58 apiece. She bought through a family trust.
Independent non-executive chair Margaret Haseltine bought 6,500 shares on-market via her personal super fund, paying $5.64 apiece.
Mark Bernhard bought 5,000 shares on-market at $5.78 per share, raising his stake by 22% to 27,500 Bapcor shares.
James Todd got the best price of his cohort, paying $5.41 for 5,000 shares on-market via his super fund.
Finally, Brad Soller picked up 3,500 shares on-market for $5.519 apiece.
Why are these directors buying?
We can't speculate as to each director's personal motivations for buying more of this ASX 200 stock.
But given the recent 21% tumble in the Bapcor share price, it may be a case of buying the dip.
Buying the dip is a great strategy for ASX investors who are confident in a company's future.
When the share price drops, they buy more stock to increase their holdings at a discount. Buying at a low price reduces the average per-share value of all of their holdings. This is known as dollar-cost averaging.
Investors often take comfort from seeing insider buys of the companies they hold.
An insider buy signals confidence. Investors like seeing directors increasing their own 'skin in the game' by investing their own money in the companies they run.
