Have Insiders Been Buying Sheng Ye Capital Limited (HKG:6069) Shares?

We often see insiders buying up shares in companies that perform well over the long term. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So we'll take a look at whether insiders have been buying or selling shares in Sheng Ye Capital Limited (HKG:6069).

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 would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But equally, we would consider it foolish to ignore insider transactions altogether. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise'.

View our latest analysis for Sheng Ye Capital

Sheng Ye Capital Insider Transactions Over The Last Year

Notably, that recent purchase by Chi Fung Tung is the biggest insider purchase of Sheng Ye Capital shares that we've seen in the last year. That implies that an insider found the current price of HK$5.95 per share to be enticing. Of course they may have changed their mind. But this suggests they are optimistic. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. In this case we're pleased to report that the insider purchases were made at close to current prices.

Sheng Ye Capital insiders may have bought shares in the last year, but they didn't sell any. 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!

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).

Insiders at Sheng Ye Capital Have Bought Stock Recently

Over the last three months, we've seen significant insider buying at Sheng Ye Capital. Overall, two insiders shelled out HK$3.3m for shares in the company -- and none sold. This makes one think the business has some good points.

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. Sheng Ye Capital insiders own about HK$3.3b worth of shares (which is 59% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At Sheng Ye Capital Tell Us?

It's certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. When combined with notable insider ownership, these factors suggest Sheng Ye Capital insiders are well aligned, and quite possibly think the share price is too low. Looks promising! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Sheng Ye Capital. Our analysis shows 2 warning signs for Sheng Ye Capital (1 doesn't sit too well with us!) and we strongly recommend you look at them before investing.

Of course Sheng Ye Capital 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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