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Insider Buyers Lose Additional CN¥80k As Zhongmin Baihui Retail Group Dips To S$67m
Insiders who bought CN¥359.9k worth of Zhongmin Baihui Retail Group Ltd.'s (SGX:5SR) stock at an average buy price of CN¥0.45 over the last year may be disappointed by the recent 17% decrease in the stock. Insiders invest with the hopes of seeing their money grow in value over time. However, as a result of recent losses, their initial investment is now only worth CN¥280.0k, which is not what they expected.
Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.
Zhongmin Baihui Retail Group Insider Transactions Over The Last Year
The CEO & Executive Director Kaitong Chen made the biggest insider purchase in the last 12 months. That single transaction was for S$360k worth of shares at a price of S$0.45 each. That means that an insider was happy to buy shares at above the current price of S$0.35. 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. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Kaitong Chen was the only individual insider to buy shares in the last twelve months.
You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
View our latest analysis for Zhongmin Baihui Retail Group
There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insider Ownership Of Zhongmin Baihui Retail Group
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. Zhongmin Baihui Retail Group insiders own 71% of the company, currently worth about S$47m based on the recent share price. 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 Zhongmin Baihui Retail Group Insider Transactions Indicate?
It doesn't really mean much that no insider has traded Zhongmin Baihui Retail Group shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. It would be great to see more insider buying, but overall it seems like Zhongmin Baihui Retail Group insiders are reasonably well aligned (owning significant chunk of the company's shares) and optimistic for the future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Zhongmin Baihui Retail Group. For instance, we've identified 4 warning signs for Zhongmin Baihui Retail Group (1 can't be ignored) you should be aware of.
Of course Zhongmin Baihui Retail Group 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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