Kuo Hsing Li Is The Founder & Chairman of Mei Ah Entertainment Group Limited (HKG:391) And Just Spent HK$327k On Shares

Whilst it may not be a huge deal, we thought it was good to see that the Mei Ah Entertainment Group Limited (HKG:391) Founder & Chairman, Kuo Hsing Li, recently bought HK$327k worth of stock, for HK$0.087 per share. Nevertheless, it only increased their shareholding by a minuscule percentage, and it wasn't a massive purchase by absolute value, either.

See our latest analysis for Mei Ah Entertainment Group

The Last 12 Months Of Insider Transactions At Mei Ah Entertainment Group

In fact, the recent purchase by Founder & Chairman Kuo Hsing Li was not their only acquisition of Mei Ah Entertainment Group shares this year. They previously made an even bigger purchase of HK$735k worth of shares at a price of HK$0.10 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being HK$0.088). 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. To us, it's very important to consider the price insiders pay for shares is very important. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Kuo Hsing Li was the only individual insider to buy during the last year.

Kuo Hsing Li purchased 78.72m shares over the year. The average price per share was HK$0.11. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. 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

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. It's great to see that Mei Ah Entertainment Group insiders own 65% of the company, worth about HK$335m. 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 Do The Mei Ah Entertainment Group Insider Transactions Indicate?

The recent insider purchase is heartening. And the longer term insider transactions also give us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Mei Ah Entertainment Group. Nice! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Mei Ah Entertainment Group. For instance, we've identified 2 warning signs for Mei Ah Entertainment Group (1 shouldn't be ignored) you should be aware of.

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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