Insider Buying: The Shougang Fushan Resources Group Limited (HKG:639) Deputy MD & Executive Director Just Bought HK$785k Worth Of Shares

By
Simply Wall St
Published
November 23, 2021
SEHK:639
Source: Shutterstock

Investors who take an interest in Shougang Fushan Resources Group Limited (HKG:639) should definitely note that the Deputy MD & Executive Director, Zhaoqiang Chen, recently paid HK$1.91 per share to buy HK$785k worth of the stock. However, it only increased shareholding by a small percentage, and it wasn't a huge purchase by absolute value, either.

See our latest analysis for Shougang Fushan Resources Group

Shougang Fushan Resources Group Insider Transactions Over The Last Year

In fact, the recent purchase by Deputy MD & Executive Director Zhaoqiang Chen was not their only trade of Shougang Fushan Resources Group shares this year. Earlier in the year, they sold shares at a price ofHK$2.34 per share in a -HK$2.3m transaction. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. It's of some comfort that this sale was conducted at a price well above the current share price, which is HK$2.05. So it is hard to draw any strong conclusion from it.

Happily, we note that in the last year insiders paid HK$1.7m for 810.03k shares. But insiders sold 2.13m shares worth HK$4.9m. All up, insiders sold more shares in Shougang Fushan Resources Group than they bought, over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
SEHK:639 Insider Trading Volume November 23rd 2021

I will like Shougang Fushan Resources Group better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Does Shougang Fushan Resources Group Boast High 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. We usually like to see fairly high levels of insider ownership. From our data, it seems that Shougang Fushan Resources Group insiders own 0.7% of the company, worth about HK$71m. However, it's possible that insiders might have an indirect interest through a more complex structure. Whilst better than nothing, we're not overly impressed by these holdings.

What Might The Insider Transactions At Shougang Fushan Resources Group Tell Us?

The recent insider purchases are heartening. On the other hand the transaction history, over the last year, isn't so positive. We don't take much heart from transactions by Shougang Fushan Resources Group insiders over the last year. But they own a reasonable amount of the company, and there was some buying recently. So they seem pretty well aligned, overall. 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 that end, you should learn about the 3 warning signs we've spotted with Shougang Fushan Resources Group (including 1 which shouldn't be ignored).

But note: Shougang Fushan Resources Group 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.

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