The recent price drop of 11% in Cathay Media and Education Group Inc. (HKG:1981) Stocks may have disappointed insiders who bought 26 million Canadian yen worth of shares at an average price of 4.34 domestic yen over the past 12 months. This is not good because insiders invest based on expectations that their money will appreciate over time. However, following recent losses, their initial investment is now worth only 11 million Canadian yen.
While insider trading isn’t the most important thing when it comes to long-term investing, logic dictates that you should pay attention to whether insiders are buying or selling stocks.
See our latest analysis for Cathay Media and Education Group
Cathay Media and Education Group insider trading over the past year
Founder Shulin Pu made the biggest insider buy in the past 12 months. This single transaction was for HK$9.3 million in shares at a price of HK$4.54 each. This means that even when the stock price was above HK$1.78 (the recent price), an insider wanted to buy stock. Their perspective may have changed since then, but it at least shows that they were feeling optimistic at the time. In our view, the price an insider pays for a stock is very important. Generally, we are more positive about a stock when an insider has bought the stock at prices above the current price, as this suggests that they view the stock as good value, even at a higher price. raised. Shulin Pu was the only individual insider to buy in the past year.
Shulin Pu purchased 5.93 million shares during the year. The average price per share was HK$4.34. The chart below shows insider trading (by companies and individuals) over the past year. If you want to know exactly who sold, how much and when, just click on the chart below!
Cathay Media and Education Group isn’t the only insider stock to buy. So take a look at this free list of growing companies with insider buying.
Does Cathay Media and Education Group boast of having high insider ownership?
Examining the total insider holdings in a company can help you know if they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely insiders will be incentivized to build the business for the long term. It’s great to see that insiders at Cathay Media and Education Group own 70% of the company, which is worth around HK$2.1 billion. Most shareholders would be happy to see this type of insider ownership, as it suggests that management’s incentives are well aligned with those of other shareholders.
What could insider trading at Cathay Media and Education Group tell us?
The fact that there have been no insider trades from Cathay Media and Education Group recently certainly doesn’t bother us. However, our analysis of transactions over the past year is encouraging. It would be great to see more insider buying, but overall it seems Cathay Media and Education Group insiders are reasonably well-aligned (holding a significant share of the company’s shares) and optimistic for the future. to come up. So these insider trades can help us build a thesis on the stock, but it’s also helpful to know the risks this company faces. For example, we have identified 3 warning signs for Cathay Media and Education Group (1 makes us a little uneasy) that you should be aware of.
If you’d rather check out another company – one with potentially superior finances – then don’t miss this free list of attractive companies, which have a high return on equity and low debt.
For the purposes of this article, insiders are persons who report their transactions to the relevant regulatory body. We currently record open market transactions and private dispositions, but not derivative transactions.
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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.