Potential Lai Sun Development Company Limited (HKG:488) shareholders may wish to note that insider Cheuk Yi Yu recently bought HK$3.6m worth of stock, paying HK$4.31 for each share. However, it only increased shareholding by a small percentage, and it wasn't a huge purchase by absolute value, either.

Check out our latest analysis for Lai Sun Development

The Last 12 Months Of Insider Transactions At Lai Sun Development

Notably, that recent purchase by insider Cheuk Yi Yu was not the only time they bought Lai Sun Development shares this year. Earlier in the year, they paid HK$6.39 per share in a HK$19m purchase. So it's clear an insider wanted to buy, even at a higher price than the current share price (being HK$4.31). 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. To us, it's very important to consider the price insiders pay for shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

Lai Sun Development insiders may have bought shares in the last year, but they didn't sell any. The average buy price was around HK$5.40. These transactions suggest that insiders have considered the current price attractive. 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!

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).

Insider Ownership Of Lai Sun Development

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. Lai Sun Development insiders own about HK$1.2b worth of shares (which is 28% 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.

What Might The Insider Transactions At Lai Sun Development Tell Us?

It's certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about Lai Sun Development. One for the watchlist, at least! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Lai Sun Development. In terms of investment risks, we've identified 2 warning signs with Lai Sun Development and understanding these should be part of your investment process.

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.

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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.