Insiders who acquired HK$2.5m worth of Star Group Company Limited's (HKG:1560) stock at an average price of HK$0.41 in the past 12 months may be dismayed by the recent 11% price decline. Insiders purchase with the hope of seeing their investments increase in value over time. However, due to recent losses, their initial investment is now only worth HK$2.1m, which is not great.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.
The Last 12 Months Of Insider Transactions At Star Group
There wasn't any very large single transaction over the last year, but we can still observe some trading.
Man Fai Chan purchased 6.00m shares over the year. The average price per share was HK$0.41. 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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that Star Group insiders own 75% of the company, worth about HK$192m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
What Might The Insider Transactions At Star Group Tell Us?
It doesn't really mean much that no insider has traded Star Group shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. Judging from their transactions, and high insider ownership, Star Group insiders feel good about the company's future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Star Group. Our analysis shows 4 warning signs for Star Group (1 is a bit unpleasant!) and we strongly recommend you look at them before investing.
Of course Star Group 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.
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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.
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