The recent 11% drop in Xinyi Glass Holdings Limited's (HKG:868) stock could come as a blow to insiders who purchased HK$24b worth of stock at an average buy price of HK$20.55 over the past 12 months. Insiders purchase with the hope of seeing their investments increase in value over time. However, due to recent losses, their initial investment is now only worth HK$14b, which is not great.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for Xinyi Glass Holdings

Xinyi Glass Holdings Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when CEO & Executive Director Ching Sai Tung bought HK$22b worth of shares at a price of HK$20.68 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being HK$12.06). Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for 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 Ching Sai Tung was also the biggest seller.

In the last twelve months insiders purchased 1.18b shares for HK$24b. On the other hand they divested 88.53m shares, for HK$1.8b. In total, Xinyi Glass Holdings insiders bought more than they sold over the last year. 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!

Xinyi Glass Holdings 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.

Xinyi Glass Holdings Insiders Bought Stock Recently

It's good to see that Xinyi Glass Holdings insiders have made notable investments in the company's shares. Not only was there no selling that we can see, but they collectively bought HK$214m worth of shares. This could be interpreted as suggesting a positive outlook.

Does Xinyi Glass 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. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that Xinyi Glass Holdings insiders own 59% of the company, worth about HK$29b. 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 Xinyi Glass Holdings Insiders?

It's certainly positive to see the recent insider purchases. And an analysis of the transactions over the last year also gives us confidence. When combined with notable insider ownership, these factors suggest Xinyi Glass Holdings insiders are well aligned, and quite possibly think the share price is too low. That's what I like to see! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Xinyi Glass Holdings. At Simply Wall St, we found 1 warning sign for Xinyi Glass Holdings that deserve your attention before buying any shares.

Of course Xinyi Glass Holdings may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

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.