Potential Zhongyu Energy Holdings Limited (HKG:3633) shareholders may wish to note that the Executive Chairman of the Board, Wenliang Wang, recently bought HK$2.4m worth of stock, paying HK$4.90 for each share. However, it only increased shareholding by a small percentage, and it wasn't a huge purchase by absolute value, either.
Zhongyu Energy Holdings Insider Transactions Over The Last Year
In fact, the recent purchase by Executive Chairman of the Board Wenliang Wang was not their only acquisition of Zhongyu Energy Holdings shares this year. They previously made an even bigger purchase of HK$2.9m worth of shares at a price of HK$5.77 per share. That means that an insider was happy to buy shares at above the current price of HK$4.92. 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. We always take careful note of the price insiders pay when purchasing shares. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. The only individual insider to buy over the last year was Wenliang Wang.
Wenliang Wang purchased 2.50m shares over the year. The average price per share was HK$5.57. 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!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Does Zhongyu Energy Holdings Boast High Insider Ownership?
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that Zhongyu Energy Holdings insiders own 36% of the company, worth about HK$5.0b. 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 Zhongyu Energy Holdings Tell Us?
The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. When combined with notable insider ownership, these factors suggest Zhongyu Energy Holdings insiders are well aligned, and quite possibly think the share price is too low. Looks promising! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Every company has risks, and we've spotted 2 warning signs for Zhongyu Energy Holdings you should know about.
Of course Zhongyu Energy 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 of direct interests only, but not derivative transactions or indirect interests.
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