Insiders Who Purchased HK$17.9m Of Golden Power Group Holdings Stock May Not Have Expected 22% Tumble
Insiders who bought HK$17.9m worth of Golden Power Group Holdings Limited's (HKG:3919) stock at an average buy price of HK$0.98 over the last year may be disappointed by the recent 22% 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 HK$9.83m, which is not what they expected.
Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Golden Power Group Holdings Insider Transactions Over The Last Year
Notably, that recent purchase by insider Kin Hang Ko was not the only time they bought Golden Power Group Holdings shares this year. Earlier in the year, they paid HK$1.20 per share in a HK$7.8m purchase. That means that an insider was happy to buy shares at above the current price of HK$0.54. Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
Happily, we note that in the last year insiders paid HK$18m for 18.37m shares. On the other hand they divested 11.74m shares, for HK$13m. Overall, Golden Power Group Holdings insiders were net buyers during the last year. The average buy price was around HK$0.98. These transactions suggest that insiders have considered the current price attractive. 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!
Check out our latest analysis for Golden Power Group Holdings
Golden Power Group Holdings is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.
Golden Power Group Holdings Insiders Are Selling The Stock
Over the last three months, we've seen notably more insider selling, than insider buying, at Golden Power Group Holdings. In total, insiders sold HK$5.9m worth of shares in that time. On the other hand we note insider Kin Hang Ko bought HK$4.2m worth of shares. We don't view these transactions as a positive sign.
Does Golden Power Group Holdings Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company 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 Golden Power Group Holdings insiders own 63% of the company, worth about HK$13m. 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 Golden Power Group Holdings Tell Us?
The insider sales have outweighed the insider buying, at Golden Power Group Holdings, in the last three months. In contrast, they appear keener if you look at the last twelve months. We are also comforted by the high levels of insider ownership. So the recent selling doesn't worry us. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Golden Power Group Holdings. Case in point: We've spotted 5 warning signs for Golden Power Group Holdings you should be aware of, and 4 of these are concerning.
Of course Golden Power Group 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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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.