Potential Symphony Holdings Limited (HKG:1223) shareholders may wish to note that the Chairman & CEO, Tun Nei Cheng, recently bought HK$1.6m worth of stock, paying HK$0.82 for each share. However, it only increased shareholding by a small percentage, and it wasn't a huge purchase by absolute value, either.
See our latest analysis for Symphony Holdings
In fact, the recent purchase by Chairman & CEO Tun Nei Cheng was not their only acquisition of Symphony Holdings shares this year. Earlier in the year, they paid HK$0.88 per share in a HK$5.3m purchase. That means that an insider was happy to buy shares at above the current price of HK$0.81. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. We always take careful note of the price insiders pay when purchasing shares. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. Tun Nei Cheng was the only individual insider to buy during the last year.
Tun Nei Cheng purchased 32.00m shares over the year. The average price per share was HK$0.87. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Symphony 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.
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. It's great to see that Symphony Holdings insiders own 63% of the company, worth about HK$1.5b. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
It is good to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Symphony Holdings. That's what I like to see! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Symphony Holdings. In terms of investment risks, we've identified 1 warning sign with Symphony Holdings and understanding this should be part of your investment process.
But note: Symphony 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.