Digital Domain Holdings Limited (HKG:547) shareholders (or potential shareholders) will be happy to see that insider Cheang Ng recently bought a whopping HK$168m worth of stock, at a price of HK$0.70. Aside from being a solid chunk in its own right, the deft move also saw their holding increase by some 37%.
Digital Domain Holdings Insider Transactions Over The Last Year
Notably, that recent purchase by Cheang Ng is the biggest insider purchase of Digital Domain Holdings shares that we've seen in the last year. Even though the purchase was made at a significantly lower price than the recent price (HK$0.80), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.
In the last twelve months insiders purchased 480.00m shares for HK$324m. On the other hand they divested 1.81m shares, for HK$1.5m. In the last twelve months there was more buying than selling by Digital Domain Holdings insiders. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
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. Digital Domain Holdings insiders own about HK$1.2b worth of shares (which is 35% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Does This Data Suggest About Digital Domain Holdings Insiders?
It is good to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about Digital Domain Holdings. One for the watchlist, at least! So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. To help with this, we've discovered 3 warning signs (1 is potentially serious!) that you ought to be aware of before buying any shares in Digital Domain Holdings.
Of course Digital Domain Holdings may not be the best stock to buy. So you may wish to see this free collection of high quality 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.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.