Even if it's not a huge purchase, we think it was good to see that Yebi Hu, the Non-Executive Director of Beijing Sports and Entertainment Industry Group Limited (HKG:1803) recently shelled out HK$638k to buy stock, at HK$0.25 per share. However, we do note that it only increased their holding by 1.6%, and it wasn't a huge purchase by absolute value, either.
The Last 12 Months Of Insider Transactions At Beijing Sports and Entertainment Industry Group
In fact, the recent purchase by Non-Executive Director Yebi Hu was not their only acquisition of Beijing Sports and Entertainment Industry Group shares this year. They previously made an even bigger purchase of HK$300m worth of shares at a price of HK$1.89 per share. That means that even when the share price was higher than HK$0.26 (the recent price), an insider wanted to purchase shares. 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. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
In the last twelve months insiders purchased 171.36m shares for HK$320m. But they sold 8435000 for HK$2.6m. In total, Beijing Sports and Entertainment Industry Group insiders bought more than they sold over the last 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!
Beijing Sports and Entertainment Industry Group 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.
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Beijing Sports and Entertainment Industry Group insiders own about HK$61m worth of shares. That equates to 18% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At Beijing Sports and Entertainment Industry Group Tell Us?
It is good to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. But on the other hand, the company made a loss last year, which makes us a little cautious. Insiders likely see value in Beijing Sports and Entertainment Industry Group shares, given these transactions (along with notable insider ownership of the company). I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow for free.
Of course Beijing Sports and Entertainment Industry Group 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.
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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