Luzhou Bank Co., Ltd. (HKG:1983) shareholders (or potential shareholders) will be happy to see that insider Min Zhou recently bought a whopping CN¥15m worth of stock, at a price of CN¥3.00. There's no denying a buy of that magnitude suggests conviction in a brighter future, although we do note that proportionally it only increased their holding by 5.0%.
The Last 12 Months Of Insider Transactions At Luzhou Bank
Over the last year, we can see that the biggest insider purchase was by insider Tung Chi Hsu for HK$182m worth of shares, at about HK$3.18 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being HK$3.08). 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. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels. Notably Tung Chi Hsu was also the biggest seller.
In the last twelve months insiders purchased 89838000 shares for HK$286m. But they sold 16562000 for HK$51m. In total, Luzhou Bank insiders bought more than they sold over the last year. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Luzhou Bank 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 Luzhou Bank
For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Luzhou Bank insiders own 7.4% of the company, worth about HK$520m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
What Might The Insider Transactions At Luzhou Bank Tell Us?
The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Luzhou Bank. One for the watchlist, at least! Along with insider transactions, I recommend checking if Luzhou Bank is growing revenue. This free chart of historic revenue and earnings should make that easy.
But note: Luzhou Bank 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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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. Thank you for reading.