Fulu Holdings Limited (HKG:2101) shareholders (or potential shareholders) will be happy to see that the Chairman & CEO, Xi Fu, recently bought a whopping HK$16m worth of stock, at a price of HK$11.04. While that only increased their holding size by 0.8%, it is still a big swing by our standards.
The Last 12 Months Of Insider Transactions At Fulu Holdings
In fact, the recent purchase by Xi Fu was the biggest purchase of Fulu Holdings shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to buy, even at a higher price than the current share price (being HK$10.44). While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. The only individual insider to buy over the last year was Xi Fu.
Xi Fu purchased 1.81m shares over the year. The average price per share was HK$11.02. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Fulu Holdings is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insider Ownership of Fulu Holdings
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. Fulu Holdings insiders own 66% of the company, currently worth about HK$2.7b 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 Fulu Holdings Insider Transactions Indicate?
The recent insider purchase is heartening. And the longer term insider transactions also give us confidence. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about Fulu Holdings. That's what I like to see! 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. To that end, you should learn about the 3 warning signs we've spotted with Fulu Holdings (including 1 which can't be ignored).
Of course Fulu 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.
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