Trade Alert: The Co-Founder & Executive Chairman of the Board Of Ngai Hing Hong Company Limited (HKG:1047), Sai Chung Hui, Has Just Spent HK$84k Buying 1.4% More Shares

Even if it's not a huge purchase, we think it was good to see that Sai Chung Hui, the Co-Founder & Executive Chairman of the Board of Ngai Hing Hong Company Limited (HKG:1047) recently shelled out HK$84k to buy stock, at HK$0.37 per share. Although the purchase is not a big one, increasing their shareholding by only 1.4%, it can be interpreted as a good sign.

See our latest analysis for Ngai Hing Hong

Ngai Hing Hong Insider Transactions Over The Last Year

In fact, the recent purchase by Sai Chung Hui was the biggest purchase of Ngai Hing Hong shares made by an insider individual in the last twelve months, according to our records. That implies that an insider found the current price of HK$0.39 per share to be enticing. 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. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. In this case we're pleased to report that the insider bought shares at close to current prices. Sai Chung Hui was the only individual insider to buy during the last year.

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!

Ngai Hing Hong is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insider Ownership of Ngai Hing Hong

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. A high insider ownership often makes company leadership more mindful of shareholder interests. Our data indicates that Ngai Hing Hong insiders own about HK$14m worth of shares (which is 10.0% of the company). We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. We do generally prefer see higher levels of insider ownership.

What Might The Insider Transactions At Ngai Hing Hong Tell Us?

It is good to see the recent insider purchase. And the longer term insider transactions also give us confidence. But we don't feel the same about the fact the company is making losses. When combined with notable insider ownership, these factors suggest Ngai Hing Hong insiders are well aligned, and that they may think the share price is too low. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To help with this, we've discovered 3 warning signs (1 is concerning!) that you ought to be aware of before buying any shares in Ngai Hing Hong.

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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