Have Insiders Been Buying Sino Hotels (Holdings) Limited (HKG:1221) Shares?

We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in Sino Hotels (Holdings) Limited (HKG:1221).

What Is Insider Selling?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, such insiders must disclose their trading activities, and not trade on inside information.

Insider transactions are not the most important thing when it comes to long-term investing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. 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'.

See our latest analysis for Sino Hotels (Holdings)

The Last 12 Months Of Insider Transactions At Sino Hotels (Holdings)

Over the last year, we can see that the biggest insider purchase was by Executive Chairman Chee Siong Ng for HK$5.0m worth of shares, at about HK$2.66 per share. That means that an insider was happy to buy shares at above the current price of HK$2.47. 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. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when an insider has purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. Chee Siong Ng was the only individual insider to buy during the last year.

You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Sino Hotels (Holdings) is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Does Sino Hotels (Holdings) Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that Sino Hotels (Holdings) insiders own 44% of the company, worth about HK$1.2b. 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 Sino Hotels (Holdings) Insiders?

It doesn't really mean much that no insider has traded Sino Hotels (Holdings) shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. With high insider ownership and encouraging transactions, it seems like Sino Hotels (Holdings) insiders think the business has merit. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Sino Hotels (Holdings). Every company has risks, and we've spotted 1 warning sign for Sino Hotels (Holdings) you should know about.

Of course Sino Hotels (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, 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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