Insider Buyers At Xinhua News Media Holdings Likely Disappointed With 13% Slide

Insiders who bought HK$44.8m worth of Xinhua News Media Holdings Limited's (HKG:309) stock at an average buy price of HK$0.069 over the last year may be disappointed by the recent 13% decrease in the stock. Insiders buy with the expectation to see their investments rise in value over a period of time. However, recent losses have rendered their above investment worth HK$26.6m which is not ideal.

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.

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Xinhua News Media Holdings Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when insider Wai Yin Lam bought HK$36m worth of shares at a price of HK$0.08 per share. That means that even when the share price was higher than HK$0.041 (the recent price), an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

Happily, we note that in the last year insiders paid HK$45m for 648.00m shares. But they sold 128.11m shares for HK$10m. In the last twelve months there was more buying than selling by Xinhua News Media Holdings insiders. The average buy price was around HK$0.069. These transactions suggest that insiders have considered the current price attractive. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

See our latest analysis for Xinhua News Media Holdings

Xinhua News Media 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

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Xinhua News Media Holdings insiders own 39% of the company, worth about HK$34m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At Xinhua News Media Holdings Tell Us?

It doesn't really mean much that no insider has traded Xinhua News Media Holdings shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. Overall we don't see anything to make us think Xinhua News Media Holdings insiders are doubting the company, and they do own shares. 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. When we did our research, we found 2 warning signs for Xinhua News Media Holdings (1 doesn't sit too well with us!) that we believe deserve your full attention.

Of course Xinhua News Media 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.