Insiders who purchased Wai Chun Bio-Technology Limited (HKG:660) shares in the past 12 months are unlikely to be deeply impacted by the stock's 13% decline over the past week. After taking the recent loss into consideration, the HK$1.1m worth of stock they bought is now worth HK$1.1m, indicating that their investment yielded a positive return.
Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.
Wai Chun Bio-Technology Insider Transactions Over The Last Year
The Executive Chairman & CEO Ching Kui Lam made the biggest insider purchase in the last 12 months. That single transaction was for HK$1.1m worth of shares at a price of HK$0.05 each. That means that an insider was happy to buy shares at around the current price of HK$0.052. 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. 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. In this case we're pleased to report that the insider bought shares at close to current prices. Ching Kui Lam was the only individual insider to buy shares in the last twelve months.
You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Wai Chun Bio-Technology 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.
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that Wai Chun Bio-Technology insiders own 85% of the company, worth about HK$74m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Does This Data Suggest About Wai Chun Bio-Technology Insiders?
It doesn't really mean much that no insider has traded Wai Chun Bio-Technology shares in the last quarter. However, our analysis of transactions over the last year is heartening. Judging from their transactions, and high insider ownership, Wai Chun Bio-Technology insiders feel good about the company's future. While we like knowing 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 Wai Chun Bio-Technology has 4 warning signs (2 are a bit unpleasant!) that deserve your attention before going any further with your analysis.
But note: Wai Chun Bio-Technology may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
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.
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.