Insider Buyers At Advanced Holdings Likely Disappointed With 13% Slide

The recent 13% drop in Advanced Holdings Ltd.'s (SGX:BLZ) stock could come as a blow to insiders who purchased S$1.00m worth of stock at an average buy price of S$0.31 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 S$540.8k which is not ideal.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Advanced Holdings

Advanced Holdings Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by Founder Kar King Wong for S$1.0m worth of shares, at about S$0.31 per share. That means that an insider was happy to buy shares at above the current price of S$0.17. It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. The only individual insider to buy over the last year was Kar King Wong.

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!

Advanced 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

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Advanced Holdings insiders own 55% of the company, currently worth about S$9.4m 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 Advanced Holdings Insiders?

It's certainly positive to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. But we don't feel the same about the fact the company is making losses. When combined with notable insider ownership, these factors suggest Advanced Holdings insiders are well aligned, and quite possibly think the share price is too low. Nice! 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. Be aware that Advanced Holdings is showing 4 warning signs in our investment analysis, and 2 of those don't sit too well with us...

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.

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.