Insiders who bought CN¥48.6m worth of XJ International Holdings Co., Ltd. (HKG:1765) stock in the last year have seen some of their losses recouped as the stock gained 10% last week. However, the purchase is proving to be an expensive wager as insiders are yet to get ahead of their losses which currently stand at CN¥25m since the time of purchase.
While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
View our latest analysis for XJ International Holdings
XJ International Holdings Insider Transactions Over The Last Year
The CEO, President & Executive Director Huiwu Wang made the biggest insider purchase in the last 12 months. That single transaction was for HK$24m worth of shares at a price of HK$0.30 each. That means that even when the share price was higher than HK$0.15 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Huiwu Wang was the only individual insider to buy during the last year.
Huiwu Wang bought 159.65m shares over the last 12 months at an average price of HK$0.30. 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!
There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).
Does XJ International Holdings Boast High Insider Ownership?
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. From looking at our data, insiders own HK$12m worth of XJ International Holdings stock, about 1.0% of the company. However, it's possible that insiders might have an indirect interest through a more complex structure. I generally like to see higher levels of ownership.
So What Do The XJ International Holdings Insider Transactions Indicate?
The fact that there have been no XJ International Holdings insider transactions recently certainly doesn't bother us. However, our analysis of transactions over the last year is heartening. Insiders do have a stake in XJ International Holdings and their transactions don't cause us concern. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing XJ International Holdings. When we did our research, we found 5 warning signs for XJ International Holdings (2 are potentially serious!) that we believe deserve your full attention.
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.