Insiders who bought Johnson Electric Holdings Limited (HKG:179) stock in the last 12 months were richly rewarded last week. The company's market value increased by HK$1.1b as a result of the stock's 10% gain over the same period. As a result, their original purchase of US$11.3m worth of stock is now worth US$15.7m.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
Check out our latest analysis for Johnson Electric Holdings
The Last 12 Months Of Insider Transactions At Johnson Electric Holdings
The Honorary Chairman Yik-Chun Wang Koo made the biggest insider purchase in the last 12 months. That single transaction was for HK$11m worth of shares at a price of HK$9.22 each. Even though the purchase was made at a significantly lower price than the recent price (HK$12.82), we still think insider buying is a positive. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.
While Johnson Electric Holdings insiders bought shares during the last year, they didn't sell. 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!
Johnson Electric Holdings is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insider Ownership Of Johnson Electric Holdings
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Johnson Electric Holdings insiders own 69% of the company, currently worth about HK$8.2b based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
What Might The Insider Transactions At Johnson Electric Holdings Tell Us?
There haven't been any insider transactions in the last three months -- that doesn't mean much. But insiders have shown more of an appetite for the stock, over the last year. Judging from their transactions, and high insider ownership, Johnson Electric Holdings insiders feel good about the company's future. 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. Every company has risks, and we've spotted 1 warning sign for Johnson Electric Holdings you should know about.
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.