Several Insiders Invested In Kinergy Flagging Positive News

Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of Kinergy Corporation Ltd. (HKG:3302), it sends a favourable message to the company's shareholders.

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.

Check out our latest analysis for Kinergy

Kinergy Insider Transactions Over The Last Year

The CEO & Executive Director Kuak Choi Lim made the biggest insider purchase in the last 12 months. That single transaction was for HK$1.5m worth of shares at a price of HK$0.30 each. That implies that an insider found the current price of HK$0.31 per share to be enticing. Of course they may have changed their mind. But this suggests they are optimistic. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. Happily, the Kinergy insiders decided to buy shares at close to current prices.

In the last twelve months Kinergy insiders were buying shares, but not selling. 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!

Kinergy 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.

Insiders At Kinergy Have Bought Stock Recently

Over the last three months, we've seen a bit of insider buying at Kinergy. Insiders shelled out HK$131k for shares in that time. It's good to see the insider buying, as well as the lack of recent sellers. But in this case the amount purchased means the recent transaction may not be very meaningful on its own.

Insider Ownership Of Kinergy

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. Kinergy insiders own 45% of the company, currently worth about HK$129m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Kinergy Insiders?

It is good to see recent purchasing. And the longer term insider transactions also give us confidence. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Kinergy. That's what I like to see! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Every company has risks, and we've spotted 4 warning signs for Kinergy (of which 1 shouldn't be ignored!) you should know about.

But note: Kinergy may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

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.