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We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So shareholders might well want to know whether insiders have been buying or selling shares in China State Construction Development Holdings Limited (HKG:830).
Do Insider Transactions Matter?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, rules govern insider transactions, and certain disclosures are required.
Insider transactions are not the most important thing when it comes to long-term investing. 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 China State Construction Development Holdings
China State Construction Development Holdings Insider Transactions Over The Last Year
Vice Chairman & CEO Mingqing Wu made the biggest insider purchase in the last 12 months. That single transaction was for HK$1.5m worth of shares at a price of HK$1.01 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being HK$0.97). 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. Generally speaking, it catches our eye when an insider has purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. Mingqing Wu was the only individual insider to buy shares in the last twelve months.
Mingqing Wu purchased 2.0m shares over the year. The average price per share was HK$1.01. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Does China State Construction Development Holdings Boast High Insider Ownership?
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. Our information indicates that China State Construction Development Holdings insiders own about HK$5.9m worth of shares. But they may have an indirect interest through a corporate structure that we haven't picked up on. This level of insider ownership is notably low, and not very encouraging.