Insiders Rewarded With HK$2.0m Addition To Investment As Soundwill Holdings Stock Hits HK$2.0b

Soundwill Holdings Limited (HKG:878) insiders who purchased shares in the last 12 months were richly rewarded last week. The stock climbed by 11% resulting in a HK$193m addition to the company’s market value. In other words, the original HK$10.9m purchase is now worth HK$12.9m.

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.

View our latest analysis for Soundwill Holdings

The Last 12 Months Of Insider Transactions At Soundwill Holdings

Over the last year, we can see that the biggest insider purchase was by Founder Kam Chu Foo for HK$877k worth of shares, at about HK$5.99 per share. We do like to see buying, but this purchase was made at well below the current price of HK$7.03. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Kam Chu Foo purchased 1.84m shares over the year. The average price per share was HK$5.94. 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!

Soundwill Holdings 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 Soundwill Holdings

For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Soundwill Holdings insiders own 75% of the company, currently worth about HK$1.5b based on the recent share price. 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 Soundwill Holdings Insider Transactions Indicate?

It's certainly positive to see the recent insider purchase. And the longer term insider transactions also give us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about Soundwill Holdings. Nice! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example - Soundwill Holdings has 1 warning sign we think you should be aware of.

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.