Qinqin Foodstuffs Group (Cayman) Insiders May Regret Not Buying More, Market Cap Hits HK$778m

Qinqin Foodstuffs Group (Cayman) Company Limited (HKG:1583) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 11%, resulting in a HK$76m rise in the company's market capitalisation, translating to a gain of 39% on their initial investment. As a result, their original purchase of CN¥1.41m worth of stock is now worth CN¥1.96m.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Qinqin Foodstuffs Group (Cayman)

The Last 12 Months Of Insider Transactions At Qinqin Foodstuffs Group (Cayman)

In the last twelve months, the biggest single purchase by an insider was when Executive Chairman of the Board Ching Lau Hui bought HK$760k worth of shares at a price of HK$0.76 per share. We do like to see buying, but this purchase was made at well below the current price of HK$1.03. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.

Ching Lau Hui bought 1.90m shares over the last 12 months at an average price of HK$0.74. 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!

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insider Ownership

Many investors like to check how much of a company is owned by 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. Qinqin Foodstuffs Group (Cayman) insiders own 65% of the company, currently worth about HK$506m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Do The Qinqin Foodstuffs Group (Cayman) Insider Transactions Indicate?

The fact that there have been no Qinqin Foodstuffs Group (Cayman) insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. It would be great to see more insider buying, but overall it seems like Qinqin Foodstuffs Group (Cayman) insiders are reasonably well aligned (owning significant chunk of the company's shares) and optimistic for the future. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. At Simply Wall St, we've found that Qinqin Foodstuffs Group (Cayman) has 3 warning signs (1 is significant!) that deserve your attention before going any further with your analysis.

Of course Qinqin Foodstuffs Group (Cayman) 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.