Bullish Water Oasis Group Insider Buying Worth HK$6.05m Yet To Pay Off

Insiders who bought HK$6.05m worth of Water Oasis Group Limited's (HKG:1161) stock at an average buy price of HK$0.88 over the last year may be disappointed by the recent 15% 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$5.32m 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, we do think it is perfectly logical to keep tabs on what insiders are doing.

See our latest analysis for Water Oasis Group

The Last 12 Months Of Insider Transactions At Water Oasis Group

The Co-Founder & Executive Director Lai Chu Yu made the biggest insider purchase in the last 12 months. That single transaction was for HK$5.1m worth of shares at a price of HK$0.85 each. That means that an insider was happy to buy shares at above the current price of HK$0.77. 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. 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$6.1m for 6.90m shares. But insiders sold 6.47m shares worth HK$5.5m. In the last twelve months there was more buying than selling by Water Oasis Group insiders. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Water Oasis Group is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Insiders At Water Oasis Group Have Sold Stock Recently

Over the last three months, we've seen significant insider selling at Water Oasis Group. In total, insider Lai Ying Ling dumped HK$431k worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.

Does Water Oasis Group Boast High 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. Water Oasis Group insiders own 46% of the company, currently worth about HK$240m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

What Might The Insider Transactions At Water Oasis Group Tell Us?

An insider sold Water Oasis Group shares recently, but they didn't buy any. But we take heart from prior transactions. We are also comforted by the high levels of insider ownership. So we're happy to look past recent trading. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. You'd be interested to know, that we found 4 warning signs for Water Oasis Group and we suggest you have a look.

But note: Water Oasis Group 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.

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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.