Contel Technology Insiders Land Bargain With Gains Of US$182m

Insiders who purchased Contel Technology Company Limited (HKG:1912) shares in the past 12 months are unlikely to be deeply impacted by the stock's 15% decline over the past week. After accounting for the recent loss, the US$24.2m worth of shares they purchased is now worth US$205.8m, suggesting a good return on their investment.

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

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Contel Technology Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by insider Hezhong Zhuang for HK$21m worth of shares, at about HK$0.37 per share. We do like to see buying, but this purchase was made at well below the current price of HK$3.10. 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.

Hezhong Zhuang purchased 66.37m shares over the year. The average price per share was HK$0.37. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

See our latest analysis for Contel Technology

Contel Technology is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Does Contel Technology Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Contel Technology insiders own about HK$1.3b worth of shares (which is 93% of the company). 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 Do The Contel Technology Insider Transactions Indicate?

The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. When combined with notable insider ownership, these factors suggest Contel Technology 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 Contel Technology. To assist with this, we've discovered 4 warning signs that you should run your eye over to get a better picture of Contel Technology.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.

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.