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Tianyang Zhao Is The Executive Chairman of the Board of Shoucheng Holdings Limited (HKG:697) And They Just Picked Up 14% More Shares

Simply Wall St ·  {{timeTz}}

Whilst it may not be a huge deal, we thought it was good to see that the Shoucheng Holdings Limited (HKG:697) Executive Chairman of the Board, Tianyang Zhao, recently bought HK$378k worth of stock, for HK$1.26 per share. While we're hesitant to get too excited about a purchase of that size, we do note it increased their holding by a solid 14%.

View our latest analysis for Shoucheng Holdings

Shoucheng Holdings Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by Non-Executive Director Jingwei Liu for HK$1.3m worth of shares, at about HK$1.68 per share. That means that an insider was happy to buy shares at above the current price of HK$1.27. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Notably Jingwei Liu was also the biggest seller.

Happily, we note that in the last year insiders paid HK$7.5m for 4.98m shares. But they sold 60.00k shares for HK$64k. In total, Shoucheng Holdings insiders bought more than they sold over the last year. They paid about HK$1.51 on average. This is nice to see since it implies that insiders might see value around current prices. You can see the insider transactions (by companies and 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!

insider-trading-volumeSEHK:697 Insider Trading Volume August 2nd 2022

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 Shoucheng Holdings Boast High 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. From looking at our data, insiders own HK$11m worth of Shoucheng Holdings stock, about 0.1% of the company. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. I generally like to see higher levels of ownership.

What Might The Insider Transactions At Shoucheng Holdings Tell Us?

The recent insider purchases are heartening. 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. When combined with notable insider ownership, these factors suggest Shoucheng Holdings insiders are well aligned, and that they may think the share price is too low. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. At Simply Wall St, we found 2 warning signs for Shoucheng 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.

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