Bullish Jisheng Group Holdings Insider Buying Worth HK$8.20m Yet To Pay Off

Insiders who bought HK$8.20m worth of Jisheng Group Holdings Limited's (HKG:8133) stock at an average buy price of HK$0.73 over the last year may be disappointed by the recent 15% decrease in the stock. Insiders invest with the hopes of seeing their money grow in value over time. However, as a result of recent losses, their initial investment is now only worth HK$4.94m, which is not what they expected.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Jisheng Group Holdings

Jisheng Group Holdings Insider Transactions Over The Last Year

The Executive Chairperson Lan Ying Woo made the biggest insider purchase in the last 12 months. That single transaction was for HK$3.0m worth of shares at a price of HK$0.80 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being HK$0.44). 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.

Happily, we note that in the last year insiders paid HK$8.2m for 11.24m shares. But insiders sold 806.00k shares worth HK$693k. Overall, Jisheng Group Holdings insiders were net buyers during the last year. 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!

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

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Jisheng Group Holdings insiders own about HK$7.5m worth of shares (which is 44% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At Jisheng Group Holdings Tell Us?

The fact that there have been no Jisheng Group Holdings insider transactions recently certainly doesn't bother us. However, our analysis of transactions over the last year is heartening. With high insider ownership and encouraging transactions, it seems like Jisheng Group Holdings insiders think the business has merit. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Jisheng Group Holdings. For instance, we've identified 3 warning signs for Jisheng Group Holdings (2 are a bit unpleasant) you should be aware of.

Of course Jisheng Group Holdings 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 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com