Trade Alert: The Non-Executive Director Of Beijing Sports and Entertainment Industry Group Limited (HKG:1803), Yebi Hu, Has Just Spent HK$92k Buying A Few More Shares

By
Simply Wall St
Published
May 02, 2022
SEHK:1803
Source: Shutterstock

Even if it's not a huge purchase, we think it was good to see that Yebi Hu, the Non-Executive Director of Beijing Sports and Entertainment Industry Group Limited (HKG:1803) recently shelled out HK$92k to buy stock, at HK$0.14 per share. Although the purchase is not a big one, by either a percentage standpoint or absolute value, it can be seen as a good sign.

View our latest analysis for Beijing Sports and Entertainment Industry Group

The Last 12 Months Of Insider Transactions At Beijing Sports and Entertainment Industry Group

Notably, that recent purchase by Non-Executive Director Yebi Hu was not the only time they bought Beijing Sports and Entertainment Industry Group shares this year. They previously made an even bigger purchase of HK$231k worth of shares at a price of HK$0.23 per share. That means that an insider was happy to buy shares at above the current price of HK$0.17. 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. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. Yebi Hu was the only individual insider to buy during the last year.

Yebi Hu bought a total of 4.96m shares over the year at an average price of HK$0.21. 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!

insider-trading-volume
SEHK:1803 Insider Trading Volume May 2nd 2022

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insider Ownership of Beijing Sports and Entertainment Industry Group

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. 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 appears that Beijing Sports and Entertainment Industry Group insiders own 28% of the company, worth about HK$67m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Beijing Sports and Entertainment Industry Group Insider Transactions Indicate?

The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Insiders likely see value in Beijing Sports and Entertainment Industry Group shares, given these transactions (along with notable insider ownership of the company). 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. Every company has risks, and we've spotted 2 warning signs for Beijing Sports and Entertainment Industry Group you should know about.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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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