Have Insiders Been Buying Cabbeen Fashion Limited (HKG:2030) Shares?

We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. 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 Cabbeen Fashion Limited (HKG:2030).

What Is Insider Buying?

Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, rules govern insider transactions, and certain disclosures are required.

We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year'.

View our latest analysis for Cabbeen Fashion

The Last 12 Months Of Insider Transactions At Cabbeen Fashion

In the last twelve months, the biggest single purchase by an insider was when Founder Ziming Yang bought HK$7.1m worth of shares at a price of HK$1.96 per share. Even though the purchase was made at a significantly lower price than the recent price (HK$2.78), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

Ziming Yang bought a total of 17.72m shares over the year at an average price of HK$1.99. 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!

Cabbeen Fashion is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insider Ownership of Cabbeen Fashion

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Cabbeen Fashion insiders own 60% of the company, currently worth about HK$1.2b based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

What Might The Insider Transactions At Cabbeen Fashion Tell Us?

The fact that there have been no Cabbeen Fashion insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. With high insider ownership and encouraging transactions, it seems like Cabbeen Fashion insiders think the business has merit. 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 Cabbeen Fashion (1 is a bit concerning!) and we strongly recommend you look at them before investing.

Of course Cabbeen Fashion 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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