Insiders In Hao Bai International (Cayman) Still Down 73% On HK$4.64m Investment

Insiders who bought HK$4.64m worth of Hao Bai International (Cayman) Limited (HKG:8431) stock in the last year have seen some of their losses recouped as the stock gained 19% last week. The purchase, however, has proven to be a pricey bet, with losses currently totalling HK$3.4m.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Hao Bai International (Cayman)

Hao Bai International (Cayman) Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when insider Yan Fan Youki Leung bought HK$3.0m worth of shares at a price of HK$0.13 per share. That means that an insider was happy to buy shares at above the current price of HK$0.037. It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Yan Fan Youki Leung was the only individual insider to buy during the last year.

Yan Fan Youki Leung bought a total of 34.36m shares over the year at an average price of HK$0.13. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Hao Bai International (Cayman) 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 Hao Bai International (Cayman)

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Hao Bai International (Cayman) insiders own about HK$6.9m worth of shares (which is 53% of the company). 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 Do The Hao Bai International (Cayman) Insider Transactions Indicate?

The recent insider purchase is heartening. We also take confidence from the longer term picture of insider transactions. But on the other hand, the company made a loss during the last year, which makes us a little cautious. When combined with notable insider ownership, these factors suggest Hao Bai International (Cayman) insiders are well aligned, and quite possibly think the share price is too low. Nice! 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. To help with this, we've discovered 6 warning signs (4 are potentially serious!) that you ought to be aware of before buying any shares in Hao Bai International (Cayman).

Of course Hao Bai International (Cayman) 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.