Insider Stock Buying Reaches S$7.0m On HG Metal Manufacturing

In the last year, multiple insiders have substantially increased their holdings of HG Metal Manufacturing Limited (SGX:BTG) stock, indicating that insiders' optimism about the company's prospects has increased.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for HG Metal Manufacturing

HG Metal Manufacturing Insider Transactions Over The Last Year

Notably, that recent purchase by Jun Xue is the biggest insider purchase of HG Metal Manufacturing shares that we've seen in the last year. That implies that an insider found the current price of S$0.29 per share to be enticing. That means they have been optimistic about the company in the past, though they may have changed their mind. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. The good news for HG Metal Manufacturing share holders is that insiders were buying at near the current price.

Over the last year, we can see that insiders have bought 25.06m shares worth S$7.0m. But insiders sold 7.54m shares worth S$5.1m. In the last twelve months there was more buying than selling by HG Metal Manufacturing insiders. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

HG Metal Manufacturing is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

HG Metal Manufacturing Insiders Bought Stock Recently

Over the last quarter, HG Metal Manufacturing insiders have spent a meaningful amount on shares. Not only was there no selling that we can see, but they collectively bought S$7.0m worth of shares. This could be interpreted as suggesting a positive outlook.

Does HG Metal Manufacturing 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. Our data indicates that HG Metal Manufacturing insiders own about S$5.9m worth of shares (which is 13% of the company). We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. We do generally prefer see higher levels of insider ownership.

So What Does This Data Suggest About HG Metal Manufacturing 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. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that HG Metal Manufacturing insiders are expecting a bright future. 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. While conducting our analysis, we found that HG Metal Manufacturing has 4 warning signs and it would be unwise to ignore them.

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 of direct interests only, but not derivative transactions or indirect interests.

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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.