Ever Harvest Group Holdings Insiders Lose Out As Stock Sinks To HK$0.089

The recent 12% drop in Ever Harvest Group Holdings Limited's (HKG:1549) stock could come as a blow to insiders who purchased HK$2.52m worth of stock at an average buy price of HK$0.10 over the past 12 months. Insiders buy with the expectation to see their investments rise in value over a period of time. However, recent losses have rendered their above investment worth HK$2.24m which is not ideal.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

See our latest analysis for Ever Harvest Group Holdings

The Last 12 Months Of Insider Transactions At Ever Harvest Group Holdings

The CEO & Executive Director Tak Fung Lau made the biggest insider purchase in the last 12 months. That single transaction was for HK$823k worth of shares at a price of HK$0.088 each. That implies that an insider found the current price of HK$0.089 per share to be enticing. That means they have been optimistic about the company in the past, though they may have changed their mind. 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. Happily, the Ever Harvest Group Holdings insiders decided to buy shares at close to current prices.

In the last twelve months Ever Harvest Group Holdings insiders were buying shares, but not selling. They paid about HK$0.10 on average. This is nice to see since it implies that insiders might see value around current prices. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

Ever Harvest Group Holdings is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Insiders At Ever Harvest Group Holdings Have Bought Stock Recently

Over the last three months, we've seen a bit of insider buying at Ever Harvest Group Holdings. Executive Chairman Yu Leung Lau purchased HK$259k worth of shares in that period. It's great to see that insiders are only buying, not selling. But in this case the amount purchased means the recent transaction may not be very meaningful on its own.

Insider Ownership Of Ever Harvest Group Holdings

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that Ever Harvest Group Holdings insiders own 74% of the company, worth about HK$102m. 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 Ever Harvest Group Holdings Insiders?

It's certainly positive to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. When combined with notable insider ownership, these factors suggest Ever Harvest Group Holdings insiders are well aligned, and quite possibly think the share price is too low. 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. Be aware that Ever Harvest Group Holdings is showing 3 warning signs in our investment analysis, and 1 of those is a bit concerning...

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.