That is not just some shares. Hamish Douglass spent $8.7 million...

That is not just some shares.
Hamish Douglass spent $8.7 million real cash to buy shares on the market.
What is his salary?
He received $1.97 million last financial year, less than the $2.6 million he took home in 2014-15.
So it is like he just spent almost 4 years total cash salary to buy shares in 2 days.
Amazing! Although one could argue it could be just a confidence fix or a real proof to reflect his view about MFG being significantly undervalued.

I think the drag on MFG in recent months is about the market worrying the possibility of US interest rate hike which might impact the ability of active managers like Magellan to attract more funds. In the future, there could be a period that Hamish Douglass' investment funds (MHG etc.) could be performing well due to his intelligence but MFG itself as an asset manager could be doing bad because the total AUM decreases due to interest rate hike. MFG is in one cyclical industry but compared to peers, it seems using better sales strategy and strong forces to minimize the cyclical impact.

During the last 3 months, MFG's ability to attract funds remains stable:
2016 Jul net inflows=$507 m
2016 Aug net inflows=$416 m
2016 Sep net inflows=$407 m
Q1 total net inflows=$1.33 billion

IMHO, directors buy, if significant, could not be a very good entry timing(which means after director buy, the price tends to drop for a while, although how much and long remains to be seen) but should be a good reflection about their view about a company's future in longer term say 1 to 3 years.