Those following along with SJM Holdings Limited (HKG:880) will no doubt be intrigued by the recent purchase of shares by On Kei Leong, Executive Co-Chairman of the company, who spent a stonking HK$238m on stock at an average price of HK$2.08. Not only is that a big swing, but it increased their holding size by 25%, which is definitely great to see.

See our latest analysis for SJM Holdings

The Last 12 Months Of Insider Transactions At SJM Holdings

Notably, that recent purchase by On Kei Leong is the biggest insider purchase of SJM Holdings shares that we've seen in the last year. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of HK$2.52. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Happily, we note that in the last year insiders paid HK$346m for 162.10m shares. On the other hand they divested 30.00m shares, for HK$87m. In the last twelve months there was more buying than selling by SJM Holdings insiders. You can see a visual depiction of insider transactions (by companies and individuals) 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!

SJM 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

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. SJM Holdings insiders own about HK$1.7b worth of shares (which is 12% of the company). Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Does This Data Suggest About SJM Holdings Insiders?

It is good to see recent purchasing. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. When combined with notable insider ownership, these factors suggest SJM Holdings insiders are well aligned, and quite possibly think the share price is too low. Looks promising! 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 found 1 warning sign for SJM Holdings that deserve your attention before buying any shares.

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.