Those following along with Luzhou Bank Co., Ltd. (HKG:1983) will no doubt be intrigued by the recent purchase of shares by insider Chih-Peng Lo, who spent a stonking HK$49m on stock at an average price of HK$2.90. Aside from being a solid chunk in its own right, the deft move also saw their holding increase by some 24%.
Luzhou Bank Insider Transactions Over The Last Year
Notably, that recent purchase by insider Chih-Peng Lo was not the only time they bought Luzhou Bank shares this year. They previously made an even bigger purchase of HK$58m worth of shares at a price of HK$3.25 per share. That means that an insider was happy to buy shares at above the current price of HK$2.75. 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. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
Happily, we note that in the last year insiders paid HK$133m for 43.46m shares. But insiders sold 16562000 shares worth HK$51m. Overall, Luzhou Bank insiders were net buyers last year. You can see the insider transactions (by individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
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
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Luzhou Bank insiders own 7.8% of the company, worth about HK$488m. 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 Do The Luzhou Bank Insider Transactions Indicate?
It's certainly positive to see the recent insider purchases. And an analysis of the transactions over the last year also gives us confidence. When combined with notable insider ownership, these factors suggest Luzhou Bank insiders are well aligned, and quite possibly think the share price is too low. Looks promising! 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 Luzhou Bank may not be the best stock to buy. So you may wish to see this free collection of high quality 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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