Potential China Merchants Bank Co., Ltd. (SHSE:600036) shareholders may wish to note that the President, Liang Wang, recently bought CN¥1.0m worth of stock, paying CN¥33.55 for each share. That's a very solid buy in our book, and increased their holding by a noteworthy 11%.

See our latest analysis for China Merchants Bank

China Merchants Bank Insider Transactions Over The Last Year

In fact, the recent purchase by Liang Wang was the biggest purchase of China Merchants Bank shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to buy, even at a higher price than the current share price (being CN¥32.84). Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Liang Wang was the only individual insider to buy shares in the last twelve months.

Liang Wang bought 50.00k shares over the last 12 months at an average price of CN¥35.46. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

China Merchants 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.

Does China Merchants Bank Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It appears that China Merchants Bank insiders own 0.01% of the company, worth about CN¥116m. 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 China Merchants Bank Insiders?

It's certainly positive to see the recent insider purchase. And the longer term insider transactions also give us confidence. When combined with notable insider ownership, these factors suggest China Merchants Bank insiders are well aligned, and quite possibly think the share price is too low. Nice! Therefore, you should definitely take a look at this FREE report showing analyst forecasts for China Merchants Bank.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.