Even if it's not a huge purchase, we think it was good to see that Kim Swee Ho, a Shangri-La Asia Limited (HKG:69) insider, recently shelled out HK$213k to buy stock, at HK$5.33 per share. However, we do note that it only increased their holding by 3.1%, and it wasn't a huge purchase by absolute value, either.
Shangri-La Asia Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Chairman of the Board Hui Kuok bought HK$167m worth of shares at a price of HK$11.10 per share. That means that an insider was happy to buy shares at above the current price of HK$5.17. 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. To us, it's very important to consider the price insiders pay for shares. 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.
While Shangri-La Asia insiders bought shares last year, they didn't sell. The average buy price was around HK$9.95. This is nice to see since it implies that insiders might see value around current prices. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
Shangri-La Asia is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Shangri-La Asia insiders own about HK$269m worth of shares. That equates to 1.4% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
So What Does This Data Suggest About Shangri-La Asia Insiders?
It's certainly positive to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about Shangri-La Asia. Looks promising! So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. For instance, we've identified 2 warning signs for Shangri-La Asia (1 is a bit concerning) you should be aware of.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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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