Zefeng Zhu Is The CEO & Chief Investment Officer of Tiangong International Company Limited (HKG:826) And Just Spent CN¥3.1m On Shares

By
Simply Wall St
Published
April 19, 2022
SEHK:826
Source: Shutterstock

Investors who take an interest in Tiangong International Company Limited (HKG:826) should definitely note that the CEO & Chief Investment Officer, Zefeng Zhu, recently paid HK$3.06 per share to buy HK$3.1m worth of the stock. Although the purchase is not a big one, by either a percentage standpoint or absolute value, it can be seen as a good sign.

Check out our latest analysis for Tiangong International

Tiangong International Insider Transactions Over The Last Year

In fact, the recent purchase by CEO & Chief Investment Officer Zefeng Zhu was not their only acquisition of Tiangong International shares this year. They previously made an even bigger purchase of HK$11m worth of shares at a price of HK$3.71 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being HK$3.07). 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 always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when an insider has purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. The only individual insider to buy over the last year was Zefeng Zhu.

Zefeng Zhu bought a total of 11.00m shares over the year at an average price of HK$3.97. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

insider-trading-volume
SEHK:826 Insider Trading Volume April 19th 2022

Tiangong International 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.

Does Tiangong International 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. I reckon it's a good sign if insiders own a significant number of shares in the company. Tiangong International insiders own about HK$2.5b worth of shares (which is 29% of the company). Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

What Might The Insider Transactions At Tiangong International Tell Us?

It's certainly positive to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Tiangong International. That's what I like to see! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Tiangong International. Every company has risks, and we've spotted 3 warning signs for Tiangong International you should know about.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.

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