Beijing Chunlizhengda Medical Instruments Co., Ltd. (HKG:1858) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 15%, resulting in a HK$509m rise in the company's market capitalisation, translating to a gain of 34% on their initial investment. As a result, the stock they originally bought for CN¥10.2m is now worth CN¥13.6m.
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.
We've discovered 1 warning sign about Beijing Chunlizhengda Medical Instruments. View them for free.The Last 12 Months Of Insider Transactions At Beijing Chunlizhengda Medical Instruments
Over the last year, we can see that the biggest insider purchase was by Executive Director Chunbao Shi for HK$6.0m worth of shares, at about HK$7.63 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of HK$9.98. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.
Chunbao Shi purchased 1.37m shares over the year. The average price per share was HK$7.45. 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!
View our latest analysis for Beijing Chunlizhengda Medical Instruments
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).
Insider Ownership Of Beijing Chunlizhengda Medical Instruments
For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that Beijing Chunlizhengda Medical Instruments insiders own 57% of the company, worth about HK$3.3b. 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 Does This Data Suggest About Beijing Chunlizhengda Medical Instruments Insiders?
The fact that there have been no Beijing Chunlizhengda Medical Instruments insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. With high insider ownership and encouraging transactions, it seems like Beijing Chunlizhengda Medical Instruments insiders think the business has merit. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Beijing Chunlizhengda Medical Instruments. In terms of investment risks, we've identified 1 warning sign with Beijing Chunlizhengda Medical Instruments and understanding this should be part of your investment process.
But note: Beijing Chunlizhengda Medical Instruments may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
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.