Don't Ignore The Insider Selling In Bonjour Holdings

We'd be surprised if Bonjour Holdings Limited (HKG:653) shareholders haven't noticed that the Executive Chairman of the Board, Jianwen Chen, recently sold HK$3.0m worth of stock at HK$0.06 per share. However, the silver lining is that the sale only reduced their total holding by 1.6%, so we're hesitant to read anything much into it, on its own.

Check out our latest analysis for Bonjour Holdings

The Last 12 Months Of Insider Transactions At Bonjour Holdings

In fact, the recent sale by Executive Chairman of the Board Jianwen Chen was not their only trade of Bonjour Holdings shares this year. They previously purchased HK$77m worth of shares at a price of HK$0.062 per share. That means that an insider was happy to buy shares at around the current price of HK$0.063. Of course they may have changed their mind. But this suggests they are optimistic. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. In this case we're pleased to report that the insider bought shares at close to current prices. The only individual insider to buy over the last year was Jianwen Chen. Notably Jianwen Chen was also the biggest seller.

The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Bonjour 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

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. Bonjour Holdings insiders own about HK$201m worth of shares (which is 67% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

What Might The Insider Transactions At Bonjour Holdings Tell Us?

An insider sold stock recently, but they haven't been buying. On the other hand, the insider transactions over the last year are encouraging. On top of that, insiders own a significant portion of the company. So the recent selling doesn't worry us. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Every company has risks, and we've spotted 6 warning signs for Bonjour Holdings you should know about.

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.