It is not uncommon to see companies perform well in the years after insiders buy shares. On the other hand, we’d be remiss not to mention that insider sales have been known to precede tough periods for a business. So before you buy or sell Sheng Siong Group Ltd (SGX:OV8), you may well want to know whether insiders have been buying or selling.
What Is Insider Buying?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.
Insider transactions are not the most important thing when it comes to long-term investing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. As Peter Lynch said, ‘insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.
The Last 12 Months Of Insider Transactions At Sheng Siong Group
CEO & Executive Director Hock Chee Lim made the biggest insider purchase in the last 12 months. That single transaction was for S$563k worth of shares at a price of S$1.13 each. So it’s clear an insider wanted to buy, at around the current price, which is S$1.21. Of course they may have changed their mind. But this suggests they are optimistic. While we always like to see insider buying, it’s less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. In this case we’re pleased to report that the insider bought shares at close to current prices. Hock Chee Lim was the only individual insider to buy shares in the last twelve months.
The chart below shows insider transactions (by individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Does Sheng Siong Group 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. We usually like to see fairly high levels of insider ownership. Sheng Siong Group insiders own 29% of the company, currently worth about S$524m 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 Sheng Siong Group Tell Us?
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, Sheng Siong Group insiders feel good about the company’s future. Of course, the future is what matters most. So if you are interested in Sheng Siong Group, you should check out this free report on analyst forecasts for the company.
Of course Sheng Siong Group 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, but not derivative transactions.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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