Insider: FTSE 250 pair present buying opportunity

The upside potential of Johnson Matthey (LSE:JMAT) shares has been highlighted by its leading directors after they bought stakes in the clean air business for the second time in four months.

• Our Services: SIPP Account | Stocks & Shares ISA | See all Investment Accounts

Board chair Andrew Cosslett spent £150,000 on Wednesday at a price of 2,168p, a move that followed £96,000 of dealings by chief executive Liam Condon two days earlier at 2,127p.

Their latest investments were made in the wake of annual results and accompanying $360 million (£270 million) acquisition of data centre-focused gas turbine catalyst maker Cormetech.

The pair also spent £200,000 in February, when shares were as low as 1,920p after JM disclosed a big cut to the sale price of its catalyst technologies arm to Honeywell.

The disposal is central to a strategic overhaul that will focus JM on vehicle emission control and its higher margin services in platinum group metals. It believes the streamlining will lead to a “step change” in cash generation and underpin attractive shareholder returns.

While shares have since rallied by a fifth from their mid-March lows, they remain short of January's four-year high of 2,388p after a strong run on the back of higher platinum prices.

• Week Ahead: WH Smith, Halma, Wizz Air
• Stockwatch: a blue-chip with long-term recovery potential

Panmure Liberum last week increased its price target to 2,580p and said the market was not giving Johnson Matthey enough credit for the significant upside to be unlocked through the disposal of the catalyst technologies arm.

The move will lead to the return of £1 billion to shareholders, comprising £800 million through a special dividend with share consolidation and £200 million via a buyback.

JM still needs regulatory approval in China, where the business is a leading player in catalysts for several chemicals important to the country such as methanol and formaldehyde.

Panmure Liberum lifted its 2027 earnings estimate by 18% following the results, which it said reflected operational progress, the addition of Cormetech and the planned return of proceeds.

The broker believes that vehicles powered by internal combustion engines will be more enduring than the market thinks and that JM has “free growth optionality” through the development of its smaller Clean Air Solutions and Hydrogen Technologies businesses.

Deutsche Bank notes that JM’s remaining operations trade on a multiple of 5.6 times forecast 2028 earnings, which compares with its upside scenario of 7.5 times.

It added on Friday: “We think the setup for Johnson Matthey is attractive from here with a strong catalyst path.”

The bank, which has a price target of 2,400p, said weakness for the FTSE 250-listed shares since the annual results on 28 May did not make sense considering the positive changes in the equity story.

• Share Sleuth: the firm I’ve bought again despite a pricey valuation
• Three advantages retail investors have over the professionals

Counterparts at Berenberg have an estimate of 2,300p but said that much will depend on the sale of JM’s catalyst technologies operation before a long-stop date of 21 August.

Management has said that the sale is on track, but Berenberg warns that failure to get the deal over the line had the potential to remove £600 million of market value.

The bank added: “Once the sale is completed, the outlook for Johnson Matthey’s shares is positive, especially given their recent underperformance versus peer Umicore and the sub-10x 2028 price/earnings valuation.”

Berenberg argues that the swoop for Cormetech has diluted the narrative that shares are in “managed decline”. It estimates that stationary emissions control, primarily for data centres, could account for over 10% of group earnings by 2029.

Buying the dip

The top two directors of GB Group (LSE:GBG) have made investments totalling £73,000 after the value of the ID and location technology firm slumped by a fifth in the wake of annual results.

Chief executive Dev Dhiman spent £49,500 on Friday at a price of 198p, while finance boss David Ward picked up £23,500 worth of shares at 196.3p on Thursday.

The FTSE 250-listed stock had been 247p prior to Tuesday’s disclosure that its current year operating margin will drop to about 21-22%. This was due to one-off investment behind the recently launched global identity platform GBG Go.

GBG said the targeted investment was likely to offer compelling returns in excess of those from M&A or share buybacks and that it expected a return to 23-24% in the 2028 financial year.

• Tech Focus: Alphabet, Anthropic, Nvidia, Marvell, Oracle
• Don’t write off UK stocks: two undervalued FTSE 100 shares

Dhiman highlighted the “compelling opportunity ahead” as he said the structural growth drivers of digital transformation, AI-accelerated fraud and increasing regulation expanded GBG’s addressable market.

He added that 2026 had been a year of considerable progress, including a return to growth at the company’s Americas Identity business and the benefit of a more efficient operating model. New and expanded relationships included with Equifax, Uber, Remitly, FedEx and Temu.

Dhiman, who joined GBG in 2020 after 12 years at Experian, said: “We are confident we will accelerate growth and deliver sustained long-term shareholder value."

• How much do you need to secure a comfortable retirement?
• Sign up to our free newsletter for investment ideas, latest news and award-winning analysis

Deutsche Bank highlighted a price target of 415p following the results, but Berenberg cut to 260p after lowering its 2027 and 2028 forecasts by 10% and 9% respectively.

It said it remained to be seen whether GB’s margin and revenue growth ambitions are achievable in an environment featuring high-growth competitors.