We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in GA Holdings Limited (HKG:8126).
What Is Insider Buying?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, rules govern insider transactions, including certain disclosures.
Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.’
G.A. Holdings Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Hui-Chuan Szu bought HK$16m worth of shares at a price of HK$0.40 per share. That implies that an insider found the current (approximate) price enticing. 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. In any event it’s generally a positive if insiders are buying shares at around the current price.
Over the last year, we can see that insiders have bought 40.24m shares worth HK$16m. But they sold 25.84m for HK$11m. In the last twelve months there was more buying than selling by G.A. Holdings insiders. The average buy price was around HK$0.40. Although they bought at below the recent price of HK$0.47 per share, it is good to see that insiders are willing to invest in the company. You can see a visual depiction of insider transactions over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
G.A. Holdings Insiders Are Selling The Stock
Over the last three months, we’ve seen significant insider selling at G.A. Holdings. In total, Hing Ka Chan sold HK$3.9m worth of shares in that time, and we didn’t record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.
Insider Ownership of G.A. Holdings
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. It’s good to see that G.A. Holdings insiders own 19% of the company, worth about HK$5.6m. This level of insider ownership is good but just short of being particularly stand-out, but it certainly does suggest a reasonable degree of alignment.
So What Does This Data Suggest About G.A. Holdings Insiders?
An insider sold stock recently, but they haven’t been buying. In contrast, they appear keener if you look at the last twelve months. It’s good to see insiders are shareholders. So we’re not overly bothered by recent selling. To put this in context, take a look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow .
If you would prefer to check out another company — one with potentially superior financials — then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at firstname.lastname@example.org.