OSL Group Limited (HKG:863) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 10%, resulting in a HK$332m rise in the company's market capitalisation, translating to a gain of 30% on their initial investment. Put another way, the original HK$961.7m acquisition is now worth HK$1.25b.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
Check out our latest analysis for OSL Group
The Last 12 Months Of Insider Transactions At OSL Group
The insider Shuai Liu made the biggest insider purchase in the last 12 months. That single transaction was for HK$713m worth of shares at a price of HK$3.80 each. We do like to see buying, but this purchase was made at well below the current price of HK$5.79. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.
Over the last year, we can see that insiders have bought 216.05m shares worth HK$962m. But they sold 5.35m shares for HK$34m. In total, OSL Group insiders bought more than they sold over the last year. The average buy price was around HK$4.45. To my mind it is good that insiders have invested their own money in the company. However, we do note that they were buying at significantly lower prices than today's share price. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
OSL Group is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.
OSL Group Insiders Bought Stock Recently
We saw some OSL Group insider buying shares in the last three months. Head of Regulatory Affairs & Executive Director Ka Chun Tiu shelled out HK$229k for shares in that time. It's good to see the insider buying, as well as the lack of recent sellers. But in this case the amount purchased means the recent transaction may not be very meaningful on its own.
Insider Ownership
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. OSL Group insiders own 34% of the company, currently worth about HK$1.2b based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
What Might The Insider Transactions At OSL Group Tell Us?
It is good to see the recent insider purchase. And the longer term insider transactions also give us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Once you factor in the high insider ownership, it certainly seems like insiders are positive about OSL Group. One for the watchlist, at least! So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Case in point: We've spotted 4 warning signs for OSL Group you should be aware of.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions of direct interests only, but not derivative transactions or indirect interests.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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