Kimou Environmental Holding Executive Chairman of the Board Acquires 3.5% More Stock

Kimou Environmental Holding Limited (HKG:6805) shareholders (or potential shareholders) will be happy to see that the Executive Chairman of the Board, Lianghong Zhang, recently bought a whopping HK$22m worth of stock, at a price of HK$1.25. There's no denying a buy of that magnitude suggests conviction in a brighter future, although we do note that proportionally it only increased their holding by 3.5%.

See our latest analysis for Kimou Environmental Holding

The Last 12 Months Of Insider Transactions At Kimou Environmental Holding

In fact, the recent purchase by Lianghong Zhang was the biggest purchase of Kimou Environmental Holding shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to buy, even at a higher price than the current share price (being HK$1.13). 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. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

Kimou Environmental Holding insiders may have bought shares in the last year, but they didn't sell any. The average buy price was around HK$1.09. Although they bought at below the recent share price, it is good to see that insiders are willing to invest in the company. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Insider Ownership Of Kimou Environmental Holding

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. Kimou Environmental Holding insiders own about HK$880m worth of shares (which is 70% 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.

So What Do The Kimou Environmental Holding Insider Transactions Indicate?

It is good to see the recent insider purchase. And the longer term insider transactions also give us confidence. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Kimou Environmental Holding. One for the watchlist, at least! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Kimou Environmental Holding. For example, Kimou Environmental Holding has 2 warning signs (and 1 which can't be ignored) we think you should know about.

But note: Kimou Environmental Holding may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

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.

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

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.