China XD Plastics Company Limited (NASDAQ:CXDC) shareholders (or potential shareholders) will be happy to see that the Chairman, Jie Han, recently bought a whopping US$1.1m worth of stock, at a price of US$2.05. While that only increased their holding size by 1.7%, it is still a big swing by our standards.
The Last 12 Months Of Insider Transactions At China XD Plastics
In fact, the recent purchase by Jie Han was the biggest purchase of China XD Plastics shares made by an insider individual in the last twelve months, according to our records. That means that even when the share price was higher than US$1.85 (the recent price), an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. 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. Jie Han was the only individual insider to buy over the year.
The chart below shows insider transactions (by individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insider Ownership of China XD Plastics
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. China XD Plastics insiders own 49% of the company, currently worth about US$61m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
What Might The Insider Transactions At China XD Plastics Tell Us?
It's certainly positive to see the recent insider purchase. 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 China XD Plastics. Nice! To put this in context, take a look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow.
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, but not derivative transactions.
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