We wouldn't blame Bonjour Holdings Limited (HKG:653) shareholders if they were a little worried about the fact that Jianwen Chen, the Executive Chairman of the Board recently netted about HK$10m selling shares at an average price of HK$0.022. That sale reduced their total holding by 15% which is hardly insignificant, but far from the worst we've seen.

Bonjour Holdings Insider Transactions Over The Last Year

In fact, the recent sale by Executive Chairman of the Board Jianwen Chen was not their only trade of Bonjour Holdings shares this year. Earlier in the year, they spent HK$77m to buy shares at HK$0.062 per share. That means that even when the share price was higher than HK$0.016 (the recent price), an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. 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. Jianwen Chen was the only individual insider to buy shares in the last twelve months. Notably Jianwen Chen was also the biggest seller.

You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

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

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Bonjour Holdings insiders own about HK$49m worth of shares (which is 64% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The Bonjour Holdings Insider Transactions Indicate?

An insider sold Bonjour Holdings shares recently, but they didn't buy any. But we take heart from prior transactions. On top of that, insiders own a significant portion of the company. So we're not too bothered by recent selling. 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. For example, Bonjour Holdings has 6 warning signs (and 3 which are significant) we think you should know about.

But note: Bonjour Holdings may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com