Xiangyu Chen Is The Co-founder of iDreamSky Technology Holdings Limited (HKG:1119) And Just Spent CN¥1.1m On Shares

Investors who take an interest in iDreamSky Technology Holdings Limited (HKG:1119) should definitely note that the Co-founder, Xiangyu Chen, recently paid HK$3.80 per share to buy HK$1.1m 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.

See our latest analysis for iDreamSky Technology Holdings

iDreamSky Technology Holdings Insider Transactions Over The Last Year

Notably, that recent purchase by Xiangyu Chen is the biggest insider purchase of iDreamSky Technology Holdings shares that we've seen in the last year. That means that an insider was happy to buy shares at above the current price of HK$3.78. It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares is very important. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

Happily, we note that in the last year insiders paid HK$9.2m for 2.36m shares. But they sold 14.40k shares for HK$55k. In total, iDreamSky Technology Holdings insiders bought more than they sold over the last year. 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. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insider Ownership of iDreamSky Technology Holdings

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that iDreamSky Technology Holdings insiders own 28% of the company, worth about HK$1.3b. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About iDreamSky Technology Holdings Insiders?

The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. When combined with notable insider ownership, these factors suggest iDreamSky Technology Holdings insiders are well aligned, and quite possibly think the share price is too low. That's what I like to see! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. At Simply Wall St, we found 2 warning signs for iDreamSky Technology Holdings that deserve your attention before buying any shares.

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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