Possible Turnaround For Unity Enterprise Holdings Insiders, Still Down HK$4.8m

Insiders who bought HK$26.0m worth of Unity Enterprise Holdings Limited (HKG:2195) stock in the last year have seen some of their losses recouped as the stock gained 23% last week. However, total losses seen by insiders are still HK$4.8m since the time of purchase.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

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The Last 12 Months Of Insider Transactions At Unity Enterprise Holdings

The insider Chung Chor Yau made the biggest insider purchase in the last 12 months. That single transaction was for HK$13m worth of shares at a price of HK$0.057 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being HK$0.049). While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. In our view, the price an insider pays for shares is very important. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Notably Chung Chor Yau was also the biggest seller.

Happily, we note that in the last year insiders paid HK$26m for 432.54m shares. But they sold 197.62m shares for HK$13m. In the last twelve months there was more buying than selling by Unity Enterprise Holdings insiders. 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!

View our latest analysis for Unity Enterprise Holdings

Unity Enterprise Holdings is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Insider Ownership Of Unity Enterprise Holdings

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. Unity Enterprise Holdings insiders own about HK$43m worth of shares (which is 62% of the company). 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 Unity Enterprise Holdings Tell Us?

The fact that there have been no Unity Enterprise Holdings insider transactions recently certainly doesn't bother us. However, our analysis of transactions over the last year is heartening. Judging from their transactions, and high insider ownership, Unity Enterprise Holdings insiders feel good about the company's future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Unity Enterprise Holdings. Be aware that Unity Enterprise Holdings is showing 4 warning signs in our investment analysis, and 2 of those are significant...

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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.