We often see insiders buying up shares in companies that perform well over the long term. 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 Yuexiu Property Company Limited (HKG:123).
What Is Insider Buying?
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.
Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia University study found that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.
Yuexiu Property Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Chairman Zhaoyuan Lin for HK$3.1m worth of shares, at about HK$1.80 per share. That means that an insider was happy to buy shares at above the current price of HK$1.64. It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
Yuexiu Property insiders may have bought shares in the last year, but they didn't sell any. The chart below shows insider transactions (by individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Insiders at Yuexiu Property Have Bought Stock Recently
It's good to see that Yuexiu Property insiders have made notable investments in the company's shares. Not only was there no selling that we can see, but they collectively bought HK$5.5m worth of shares. That shows some optimism about the company's future.
Insider Ownership of Yuexiu Property
Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. From looking at our data, insiders own HK$39m worth of Yuexiu Property stock, about 0.2% of the company. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. We consider this fairly low insider ownership.
So What Does This Data Suggest About Yuexiu Property Insiders?
The recent insider purchases are heartening. We also take confidence from the longer term picture of insider transactions. Given that insiders also own a fair bit of Yuexiu Property we think they are probably pretty confident of a bright future. Of course, the future is what matters most. So if you are interested in Yuexiu Property, you should check out this free report on analyst forecasts for the company.
But note: Yuexiu Property 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.
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