Reversal Of Fortune For A-Smart Holdings Insiders Who Made A S$7.21m Purchase

Some of the losses seen by insiders who purchased S$7.21m worth of A-Smart Holdings Ltd. (SGX:BQC) shares over the past year were recovered after the stock increased by 25% over the past week. However, the purchase is proving to be a costly gamble, since losses made by insiders have totalled S$793k since the time of purchase.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for A-Smart Holdings

A-Smart Holdings Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by Non-Executive Chairman Wei Dong Ma for S$3.8m worth of shares, at about S$0.10 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being S$0.089). 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. To us, it's very important to consider the price insiders pay for shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

A-Smart Holdings insiders may have bought shares in the last year, but they didn't sell any. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

A-Smart Holdings is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership Of A-Smart 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. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that A-Smart Holdings insiders own 77% of the company, worth about S$18m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At A-Smart Holdings Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. However, our analysis of transactions over the last year is heartening. It would be great to see more insider buying, but overall it seems like A-Smart Holdings insiders are reasonably well aligned (owning significant chunk of the company's shares) and optimistic for the future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To assist with this, we've discovered 3 warning signs that you should run your eye over to get a better picture of A-Smart Holdings.

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.