Insiders who purchased HK$3.60m worth of Hopefluent Group Holdings Limited (HKG:733) shares over the past year recouped some of their losses after price gained 17% last week. However, the purchase is proving to be an expensive wager as insiders are yet to get ahead of their losses which currently stand at HK$936k since the time of purchase.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Hopefluent Group Holdings Insider Transactions Over The Last Year
The Non-Executive Director Ear Ly Fu made the biggest insider purchase in the last 12 months. That single transaction was for HK$3.6m worth of shares at a price of HK$0.30 each. That means that even when the share price was higher than HK$0.22 (the recent price), an insider wanted to purchase shares. 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 our view, the price an insider pays for shares is very important. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. Ear Ly Fu was the only individual insider to buy during the last year.
The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
Check out our latest analysis for Hopefluent Group Holdings
Hopefluent 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.
Insider Ownership
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Hopefluent Group Holdings insiders own 40% of the company, worth about HK$60m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Does This Data Suggest About Hopefluent Group Holdings Insiders?
It doesn't really mean much that no insider has traded Hopefluent Group Holdings shares in the last quarter. However, our analysis of transactions over the last year is heartening. Insiders own shares in Hopefluent Group Holdings and we see no evidence to suggest they are worried about the future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Hopefluent Group Holdings. In terms of investment risks, we've identified 1 warning sign with Hopefluent Group Holdings and understanding it should be part of your investment process.
But note: Hopefluent Group Holdings 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.