Hopeful Week For Insiders Who Bought HK$7.79m Of Tianda Pharmaceuticals Stock

Insiders who bought HK$7.79m worth of Tianda Pharmaceuticals Limited (HKG:455) stock in the last year recovered part of their losses as the stock rose by 10.0% last week. However, total losses seen by insiders are still HK$2.8m since the time of purchase.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for Tianda Pharmaceuticals

The Last 12 Months Of Insider Transactions At Tianda Pharmaceuticals

The Executive Chairman & MD Wen Quan Fang made the biggest insider purchase in the last 12 months. That single transaction was for HK$2.7m worth of shares at a price of HK$0.39 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being HK$0.22). 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. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. The only individual insider to buy over the last year was Wen Quan Fang.

Wen Quan Fang bought 22.68m shares over the last 12 months at an average price of HK$0.34. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Tianda Pharmaceuticals is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insider Ownership Of Tianda Pharmaceuticals

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that Tianda Pharmaceuticals insiders own 57% of the company, worth about HK$268m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Does This Data Suggest About Tianda Pharmaceuticals Insiders?

There haven't been any insider transactions in the last three months -- that doesn't mean much. However, our analysis of transactions over the last year is heartening. With high insider ownership and encouraging transactions, it seems like Tianda Pharmaceuticals insiders think the business has merit. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Case in point: We've spotted 2 warning signs for Tianda Pharmaceuticals you should be aware of, and 1 of these doesn't sit too well with us.

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 of direct interests only, but not derivative transactions or indirect interests.

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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.