Have Insiders Been Buying SG Group Holdings Limited (HKG:1657) Shares This Year?

It is not uncommon to see companies perform well in the years after insiders buy shares. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So we'll take a look at whether insiders have been buying or selling shares in SG Group Holdings Limited (HKG:1657).

What Is Insider Selling?

It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, such insiders must disclose their trading activities, and not trade on inside information.

We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia University study found that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.

Check out our latest analysis for SG Group Holdings

The Last 12 Months Of Insider Transactions At SG Group Holdings

The Chairman King Choi made the biggest insider purchase in the last 12 months. That single transaction was for HK$662k worth of shares at a price of HK$5.99 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being HK$3.06). It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

While SG Group Holdings insiders bought shares during the last year, they didn't sell. 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!

SG Group Holdings is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Have SG Group Holdings Insiders Traded Recently?

We saw some SG Group Holdings insider buying shares in the last three months. Chairman King Choi shelled out HK$45k for shares in that time. It's great to see that insiders are only buying, not selling. But the amount invested in the last three months isn't enough for us too put much weight on it, as a single factor.

Does SG Group Holdings Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. It's great to see that SG Group Holdings insiders own 73% of the company, worth about HK$71m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Does This Data Suggest About SG Group Holdings Insiders?

We note a that there has been a bit of insider buying recently (but no selling). The net investment is not enough to encourage us much. However, our analysis of transactions over the last year is heartening. Judging from their transactions, and high insider ownership, SG Group Holdings insiders feel good about the company's future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Our analysis shows 4 warning signs for SG Group Holdings (1 is potentially serious!) and we strongly recommend you look at them before investing.

But note: SG Group Holdings 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, 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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