Insider Stock Buying Of Denox Environmental & Technology Holdings Delivers Return On CN¥4.74m Investment

Denox Environmental & Technology Holdings Limited (HKG:1452) insiders who acquired shares over the previous 12 months, can probably afford to ignore the recent 17% decline in the stock price. After taking the recent loss into consideration, the CN¥4.74m worth of stock they bought is now worth CN¥6.42m, indicating that their investment yielded a positive return.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Denox Environmental & Technology Holdings

Denox Environmental & Technology Holdings Insider Transactions Over The Last Year

The Chairlady & CEO Shu Zhao made the biggest insider purchase in the last 12 months. That single transaction was for HK$4.7m worth of shares at a price of HK$0.048 each. We do like to see buying, but this purchase was made at well below the current price of HK$0.065. 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.

You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

Denox Environmental & Technology Holdings is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. Denox Environmental & Technology Holdings insiders own 56% of the company, currently worth about HK$21m 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 Does This Data Suggest About Denox Environmental & Technology Holdings Insiders?

The fact that there have been no Denox Environmental & Technology Holdings insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. It would be great to see more insider buying, but overall it seems like Denox Environmental & Technology Holdings insiders are reasonably well aligned (owning significant chunk of the company's shares) and optimistic for the future. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For example, Denox Environmental & Technology Holdings has 2 warning signs (and 1 which doesn't sit too well with us) we think you should know about.

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.