Have Insiders Been Buying Wisdom Education International Holdings Company Limited (HKG:6068) Shares This Year?

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 Wisdom Education International Holdings Company Limited (HKG:6068).

Do Insider Transactions Matter?

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.

We don't think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year'.

View our latest analysis for Wisdom Education International Holdings

The Last 12 Months Of Insider Transactions At Wisdom Education International Holdings

The Executive Director Xuebin Liu made the biggest insider purchase in the last 12 months. That single transaction was for HK$6.0m worth of shares at a price of HK$3.18 each. That implies that an insider found the current price of HK$3.96 per share to be enticing. That means they have been optimistic about the company in the past, though they may have changed their mind. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. Happily, the Wisdom Education International Holdings insiders decided to buy shares at close to current prices.

While Wisdom Education International Holdings insiders bought shares during the last year, they didn't sell. They paid about HK$2.54 on average. It is certainly positive to see that insiders have invested their own money in the company. However, you should keep in mind that they bought when the share price was meaningfully below today's levels. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Wisdom Education International Holdings is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

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. Wisdom Education International Holdings insiders own about HK$5.9b worth of shares (which is 69% 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 Wisdom Education International Holdings Tell Us?

The fact that there have been no Wisdom Education International Holdings insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. Judging from their transactions, and high insider ownership, Wisdom Education International Holdings insiders feel good about the company's future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Wisdom Education International Holdings. In terms of investment risks, we've identified 4 warning signs with Wisdom Education International Holdings and understanding them should be part of your investment process.

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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