Insiders who acquired HK$3.36m worth of Huasheng International Holding Limited's (HKG:1323) stock at an average price of HK$0.21 in the past 12 months may be dismayed by the recent 12% price decline. Insiders buy with the expectation to see their investments rise in value over a period of time. However, recent losses have rendered their above investment worth HK$2.61m which is not ideal.
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.
Huasheng International Holding Insider Transactions Over The Last Year
The insider Chia-Hsiang Chang made the biggest insider purchase in the last 12 months. That single transaction was for HK$1.5m worth of shares at a price of HK$0.24 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being HK$0.16). It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when an insider has purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. Chia-Hsiang Chang was the only individual insider to buy shares in the last twelve months.
Chia-Hsiang Chang bought 16.22m shares over the last 12 months at an average price of HK$0.21. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
See our latest analysis for Huasheng International Holding
Huasheng International Holding is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.
Does Huasheng International Holding Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Huasheng International Holding insiders own 40% of the company, currently worth about HK$49m 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.
So What Do The Huasheng International Holding Insider Transactions Indicate?
There haven't been any insider transactions in the last three months -- that doesn't mean much. However, our analysis of transactions over the last year is heartening. Judging from their transactions, and high insider ownership, Huasheng International Holding insiders feel good about the company's 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. For instance, we've identified 3 warning signs for Huasheng International Holding (1 is a bit concerning) 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.