I like to keep an eye on substantial shareholder notices. This is because these notices give you an idea of which shares large investors, asset managers, and investment funds are buying or selling.
Two notices that have caught my eye are summarised below. Here’s what these fund managers have been buying:
EML Payments Ltd (ASX: EML)
A notice of change of interests of substantial holder reveals that Commonwealth Bank of Australia (ASX: CBA) has been buying this payments company’s shares via its Avanteos Investments and Colonial First State businesses.
According to the release, the bank has increased its holding in EML Payments by ~3.75 million shares from ~18.3 million to ~22.06 million shares. This equates to a 6.1% stake in the company, which is up from 5.06% previously.
One leading broker that would be supportive of these purchases is UBS. Last month the broker responded to the company’s announcement of the acquisition of Nuapay by retaining its buy rating and lifting its price target to $6.20.
The EML Payments share price is currently trading at $5.18. This implies potential upside of almost 20% over the next 12 months.
IDP Education Ltd (ASX: IEL)
Another notice of change of interests of substantial holder shows that Bennelong Funds Management has been increasing its stake in this language testing and student placement company.
According to the notice, Bennelong Funds Management has acquired approximately 5.5 million IDP Education shares, lifting its stake to a total of ~25.3 million shares. This means it has increased its interest from 7.7% to almost 9.1%.
Once again, analysts at UBS are likely to approve of these purchases. Last month the broker put a buy rating and $29.05 price target on the company’s shares.
The compares to the latest IDP Education of $20.81, which represents potential upside of almost 40% over the next 12 months.
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James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends EML Payments. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Idp Education Pty Ltd. The Motley Fool Australia has recommended EML Payments. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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