Chief Executive Officer and Executive Director Jun Li Just Bought 33% More Shares In Greentown Management Holdings Company Limited (HKG:9979)

Those following along with Greentown Management Holdings Company Limited (HKG:9979) will no doubt be intrigued by the recent purchase of shares by Jun Li, Chief Executive Officer and Executive Director of the company, who spent a stonking HK$9.3m on stock at an average price of HK$3.45. Aside from being a solid chunk in its own right, the deft move also saw their holding increase by some 33%.

View our latest analysis for Greentown Management Holdings

Greentown Management Holdings Insider Transactions Over The Last Year

In fact, the recent purchase by Chief Executive Officer and Executive Director Jun Li was not their only acquisition of Greentown Management Holdings shares this year. They previously made an even bigger purchase of HK$12m worth of shares at a price of HK$3.34 per share. That means that even when the share price was higher than HK$3.34 (the recent price), an insider wanted to purchase shares. 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. To us, it's very important to consider the price insiders pay for shares is very important. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. The only individual insider to buy over the last year was Jun Li.

Jun Li bought 11.75m shares over the last 12 months at an average price of HK$3.37. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Our data suggests Greentown Management Holdings insiders own 0.3% of the company, worth about HK$20m. I generally like to see higher levels of ownership.

So What Does This Data Suggest About Greentown Management Holdings Insiders?

It's certainly positive to see the recent insider purchase. And the longer term insider transactions also give us confidence. Insiders likely see value in Greentown Management Holdings shares, given these transactions (along with notable insider ownership of the company). So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. At Simply Wall St, we found 1 warning sign for Greentown Management Holdings that deserve your attention before buying any shares.

Of course Greentown Management 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, but not derivative transactions.

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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. 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.
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