Yahoo Finance Are Insiders Buying NagaCorp Ltd. (HKG:3918) Stock?
We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we’ll take a look at whether insiders have been buying or selling shares in NagaCorp Ltd. (HKG:3918).
What Is Insider Buying?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, such insiders must disclose their trading activities, and not trade on inside information.
We don’t think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. As Peter Lynch said, ‘insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.’
Check out our latest analysis for NagaCorp
The Last 12 Months Of Insider Transactions At NagaCorp
Founder Lip Chen made the biggest insider purchase in the last 12 months. That single transaction was for HK$47m worth of shares at a price of HK$7.16 each. That means that an insider was happy to buy shares at around the current price. That means they have been optimistic about the company in the past, though they may have changed their mind. We generally consider it a positive if insiders have been buying on market, even if the share price has increased a bit since then. Lip Chen was the only individual insider to buy over the year.
Lip Chen purchased 29.64m shares over the year. The average price per share was HK$7.22. You can see a visual depiction of insider transactions 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!
NagaCorp is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insider Ownership of NagaCorp
Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. NagaCorp insiders own about HK$24b worth of shares (which is 62% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Do The NagaCorp Insider Transactions Indicate?
It is good to see recent insider purchase. We also take confidence from the longer term picture of insider transactions. When combined with notable insider ownership, these factors suggest NagaCorp insiders are well aligned, and quite possibly think the share price is too low. Nice! If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
Of course NagaCorp may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
