Those following along with Cornerstone Technologies Holdings Limited (HKG:8391) will no doubt be intrigued by the recent purchase of shares by Zihao Liang, Executive Co-Chairman of the Board & Chief Compliance Officer of the company, who spent a stonking HK$10m on stock at an average price of HK$1.14. That increased their holding by a full 64%, which arguably implies the sort of confidence required for a shy sweet-natured nerd to ask the most popular kid in the school to go out on a date.

See our latest analysis for Cornerstone Technologies Holdings

Cornerstone Technologies Holdings Insider Transactions Over The Last Year

In fact, the recent purchase by Zihao Liang was the biggest purchase of Cornerstone Technologies Holdings shares made by an insider individual in the last twelve months, according to our records. That means that even when the share price was higher than HK$0.69 (the recent price), an insider wanted to purchase shares. 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. In our view, the price an insider pays for shares is very important. 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.

Happily, we note that in the last year insiders paid HK$40m for 35.20m shares. But insiders sold 500.00k shares worth HK$1.3m. Overall, Cornerstone Technologies Holdings insiders were net buyers during the last year. 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!

Cornerstone Technologies 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.

Insider Ownership

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 20% of Cornerstone Technologies Holdings shares, worth about HK$114m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At Cornerstone Technologies Holdings Tell Us?

It's certainly positive to see the recent insider purchases. And an analysis of the transactions over the last year also gives 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 Cornerstone Technologies Holdings insiders are well aligned, and quite possibly think the share price is too low. Nice! So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Be aware that Cornerstone Technologies Holdings is showing 5 warning signs in our investment analysis, and 2 of those make us uncomfortable...

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.