Insiders See HK$37.7m Investment In CT Vision (International) Holdings Jump Last Week
CT Vision (International) Holdings Limited (HKG:994) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 36%, resulting in a HK$107m rise in the company's market capitalisation, translating to a gain of 118% on their initial investment. As a result, the stock they originally bought for HK$37.7m is now worth HK$82.1m.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
The Last 12 Months Of Insider Transactions At CT Vision (International) Holdings
Over the last year, we can see that the biggest insider purchase was by insider Gang Zhu for HK$23m worth of shares, at about HK$0.36 per share. That means that even when the share price was higher than HK$0.32 (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 if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Notably Gang Zhu was also the biggest seller.
Over the last year, we can see that insiders have bought 260.50m shares worth HK$38m. But insiders sold 42.12m shares worth HK$13m. In the last twelve months there was more buying than selling by CT Vision (International) Holdings insiders. They paid about HK$0.14 on average. We don't deny that it is nice to see insiders buying stock in the company. However, we do note that they were buying at significantly lower prices than today's share price. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Check out our latest analysis for CT Vision (International) Holdings
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).
CT Vision (International) Holdings Insiders Are Selling The Stock
The last three months saw significant insider selling at CT Vision (International) Holdings. In total, Executive Director Ji Ding dumped HK$2.3m worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.
Insider Ownership
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. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 19% of CT Vision (International) Holdings shares, worth about HK$77m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Do The CT Vision (International) Holdings Insider Transactions Indicate?
An insider hasn't bought CT Vision (International) Holdings stock in the last three months, but there was some selling. In contrast, they appear keener if you look at the last twelve months. It's good to see insiders are shareholders. So we're happy enough to look past some selling. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. At Simply Wall St, we've found that CT Vision (International) Holdings has 3 warning signs (1 makes us a bit uncomfortable!) that deserve your attention before going any further with your analysis.
Of course CT Vision (International) 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.