Labixiaoxin Snacks Group Insiders Enjoying CN¥49m Appreciation On CN¥68.8m Investment

Labixiaoxin Snacks Group Limited (HKG:1262) insiders who purchased shares in the last 12 months were richly rewarded last week. The stock climbed by 16% resulting in a HK$57m addition to the company’s market value. As a result, their original purchase of CN¥68.8m worth of stock is now worth CN¥117.6m.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for Labixiaoxin Snacks Group

Labixiaoxin Snacks Group Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when insider Zheng Long bought HK$69m worth of shares at a price of HK$1.10 per share. Even though the purchase was made at a significantly lower price than the recent price (HK$1.88), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Labixiaoxin Snacks Group is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Insider Ownership

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Labixiaoxin Snacks Group insiders own 34% of the company, worth about HK$140m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At Labixiaoxin Snacks Group Tell Us?

The recent insider purchase is heartening. We also take confidence from the longer term picture of insider transactions. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. When combined with notable insider ownership, these factors suggest Labixiaoxin Snacks Group insiders are well aligned, and quite possibly think the share price is too low. Looks promising! 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. Case in point: We've spotted 2 warning signs for Labixiaoxin Snacks Group you should be aware of, and 1 of these 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 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.