China Lesso Group Holdings Limited (HKG:2128) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 10%, resulting in a HK$1.1b rise in the company's market capitalisation, translating to a gain of 46% on their initial investment. In other words, the original CN¥11.7m purchase is now worth CN¥17.1m.
While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.
Check out our latest analysis for China Lesso Group Holdings
The Last 12 Months Of Insider Transactions At China Lesso Group Holdings
In the last twelve months, the biggest single purchase by an insider was when Founder & Executive Chairman Luen Hei Wong bought HK$10m worth of shares at a price of HK$2.51 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of HK$3.80. 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.
In the last twelve months China Lesso Group Holdings insiders were buying shares, but not selling. 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 plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.
Does China Lesso Group 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. I reckon it's a good sign if insiders own a significant number of shares in the company. China Lesso Group Holdings insiders own 69% of the company, currently worth about HK$8.2b based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
What Might The Insider Transactions At China Lesso Group Holdings Tell Us?
The fact that there have been no China Lesso Group Holdings insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. It would be great to see more insider buying, but overall it seems like China Lesso Group Holdings insiders are reasonably well aligned (owning significant chunk of the company's shares) and optimistic for the future. 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. While conducting our analysis, we found that China Lesso Group Holdings has 2 warning signs and it would be unwise to ignore them.
Of course China Lesso Group Holdings may not be the best stock to buy. So you may wish to see this free collection of high quality 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.