Regencell Bioscience Holdings Limited (NASDAQ:RGC) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 20%, resulting in a US$69m rise in the company's market capitalisation. In other words, the original US$6.0m purchase is now worth US$7.1m.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

See our latest analysis for Regencell Bioscience Holdings

Regencell Bioscience Holdings Insider Transactions Over The Last Year

The Founder Yat-Gai Au made the biggest insider purchase in the last 12 months. That single transaction was for US$3.9m worth of shares at a price of US$29.29 each. That means that an insider was happy to buy shares at around the current price of US$32.28. 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. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. In this case we're pleased to report that the insider bought shares at close to current prices. The only individual insider to buy over the last year was Yat-Gai Au.

Yat-Gai Au purchased 219.49k shares over the year. The average price per share was US$27.41. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

Regencell Bioscience Holdings is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Regencell Bioscience Holdings insiders own 81% of the company, currently worth about US$341m based on the recent share price. 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 Does This Data Suggest About Regencell Bioscience Holdings Insiders?

The recent insider purchase is heartening. And the longer term insider transactions also give us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. When combined with notable insider ownership, these factors suggest Regencell Bioscience Holdings insiders are well aligned, and quite possibly think the share price is too low. Nice! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. At Simply Wall St, we've found that Regencell Bioscience Holdings has 2 warning signs (1 is a bit unpleasant!) that deserve your attention before going any further with your analysis.

But note: Regencell Bioscience Holdings may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.

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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.