Far East Consortium International Chairman & CEO Acquires 1.1% More Stock

Those following along with Far East Consortium International Limited (HKG:35) will no doubt be intrigued by the recent purchase of shares by Tat Cheong Chiu, Chairman & CEO of the company, who spent a stonking HK$17m on stock at an average price of HK$0.92. There's no denying a buy of that magnitude suggests conviction in a brighter future, although we do note that proportionally it only increased their holding by 1.1%.

Check out our latest analysis for Far East Consortium International

Far East Consortium International Insider Transactions Over The Last Year

Notably, that recent purchase by Chairman & CEO Tat Cheong Chiu was not the only time they bought Far East Consortium International shares this year. They previously made an even bigger purchase of HK$154m worth of shares at a price of HK$1.05 per share. That means that an insider was happy to buy shares at above the current price of HK$0.79. It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

While Far East Consortium International insiders bought shares during the last year, they didn't sell. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insider Ownership Of Far East Consortium International

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Far East Consortium International insiders own about HK$1.4b worth of shares (which is 57% 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 Do The Far East Consortium International Insider Transactions Indicate?

It's certainly positive to see the recent insider purchases. We also take confidence from the longer term picture of insider transactions. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Far East Consortium International. One for the watchlist, at least! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Far East Consortium International. To help with this, we've discovered 2 warning signs (1 makes us a bit uncomfortable!) that you ought to be aware of before buying any shares in Far East Consortium International.

Of course Far East Consortium International 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 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.