Sean Ma of MGM China Holdings Limited (HKG:2282) Just Spent HK$318m On Shares

Those following along with MGM China Holdings Limited (HKG:2282) will no doubt be intrigued by the recent purchase of shares by insider Sean Ma, who spent a stonking HK$318m on stock at an average price of HK$13.19. There's no denying a buy of that magnitude suggests conviction in a brighter future, although we do note that proportionally it only increased their holding by 9.2%.

See our latest analysis for MGM China Holdings

MGM China Holdings Insider Transactions Over The Last Year

Notably, that recent purchase by Sean Ma is the biggest insider purchase of MGM China Holdings shares that we've seen in the last year. That means that an insider was happy to buy shares at above the current price of HK$12.30. 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. 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. Sean Ma was the only individual insider to buy during the last year.

Sean Ma purchased 39.57m shares over the year. The average price per share was HK$12.00. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

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

Does MGM China Holdings Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. MGM China Holdings insiders own about HK$13b worth of shares (which is 29% of the company). 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 MGM China Holdings Tell Us?

The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Once you factor in the high insider ownership, it certainly seems like insiders are positive about MGM China Holdings. One for the watchlist, at least! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Be aware that MGM China Holdings is showing 2 warning signs in our investment analysis, and 1 of those can't be ignored...

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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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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