It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in Jenscare Scientific Co., Ltd.'s (HKG:9877) case, it's fantastic news for shareholders.
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.
The Last 12 Months Of Insider Transactions At Jenscare Scientific
Over the last year, we can see that the biggest insider purchase was by Chairman Shiwen Lv for HK$2.1m worth of shares, at about HK$14.50 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being HK$12.50). It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing 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.
In the last twelve months Jenscare Scientific insiders were buying shares, but not selling. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Jenscare Scientific is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insiders At Jenscare Scientific Have Bought Stock Recently
Over the last three months, we've seen significant insider buying at Jenscare Scientific. Overall, two insiders shelled out HK$3.7m for shares in the company -- and none sold. That shows some optimism about the company's future.
Insider Ownership Of Jenscare Scientific
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. A high insider ownership often makes company leadership more mindful of shareholder interests. Jenscare Scientific insiders own 17% of the company, currently worth about HK$862m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
What Might The Insider Transactions At Jenscare Scientific Tell Us?
The recent insider purchases are heartening. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Jenscare Scientific. One for the watchlist, at least! 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. At Simply Wall St, we've found that Jenscare Scientific has 3 warning signs (2 shouldn't be ignored!) that deserve your attention before going any further with your analysis.
But note: Jenscare Scientific 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.
