It is not uncommon to see companies perform well in the years after insiders buy shares. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So shareholders might well want to know whether insiders have been buying or selling shares in Man Shun Group (Holdings) Limited (HKG:1746).
What Is Insider Selling?
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But it is perfectly logical to keep tabs on what insiders are doing. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.
Man Shun Group (Holdings) Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when insider Hisao Ishiyama bought HK$21m worth of shares at a price of HK$0.50 per share. That means that even when the share price was higher than HK$0.42 (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. We always take careful note of the price insiders pay when purchasing shares. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. Hisao Ishiyama was the only individual insider to buy over the year.
Hisao Ishiyama bought 45.00m shares over the last 12 months at an average price of HK$0.50. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Man Shun Group (Holdings) is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insider Ownership of Man Shun Group (Holdings)
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. From our data, it seems that Man Shun Group (Holdings) insiders own 9.0% of the company, worth about HK$38m. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!
So What Do The Man Shun Group (Holdings) Insider Transactions Indicate?
It doesn't really mean much that no insider has traded Man Shun Group (Holdings) shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. Insiders do have a stake in Man Shun Group (Holdings) and their transactions don't cause us concern. Along with insider transactions, I recommend checking if Man Shun Group (Holdings) is growing revenue. This free chart of historic revenue and earnings should make that easy.
But note: Man Shun 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, but not derivative transactions.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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