Insider Buying: Melco International Development Executive Chairman & CEO Bought HK$3.4m Of Shares

Potential Melco International Development Limited (HKG:200) shareholders may wish to note that the Executive Chairman & CEO, Yau Lung Ho, recently bought HK$3.4m worth of stock, paying HK$6.77 for each 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.

See our latest analysis for Melco International Development

The Last 12 Months Of Insider Transactions At Melco International Development

Notably, that recent purchase by Yau Lung Ho is the biggest insider purchase of Melco International Development shares that we've seen in the last year. So it's clear an insider wanted to buy, even at a higher price than the current share price (being HK$6.47). Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Yau Lung Ho was the only individual insider to buy shares in the last twelve months.

Che Yin Tsui ditched 1.15m shares over the year. The average price per share was HK$6.07. 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!

I will like Melco International Development better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Does Melco International Development Boast High Insider Ownership?

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's great to see that Melco International Development insiders own 52% of the company, worth about HK$5.1b. 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 Do The Melco International Development Insider Transactions Indicate?

It is good to see the recent insider purchase. On the other hand the transaction history, over the last year, isn't so positive. Overall, we'd prefer see a more sustained buying from directors, but with a significant insider holding and more recent purchases, Melco International Development insiders are reasonably well aligned, and optimistic for the future. Therefore, you should definitely take a look at this FREE report showing analyst forecasts for Melco International Development.

Of course Melco International Development 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 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.