Yushuai Zhang Bought 3.8% More Shares In Sunshine Lake Pharma
Those following along with Sunshine Lake Pharma Co., Ltd. (HKG:6887) will no doubt be intrigued by the recent purchase of shares by Yushuai Zhang, Non-Executive Director of the company, who spent a stonking HK$4.2m on stock at an average price of HK$38.99. While that only increased their holding size by 3.8%, it is still a big swing by our standards.
Sunshine Lake Pharma Insider Transactions Over The Last Year
Notably, that recent purchase by Non-Executive Director Yushuai Zhang was not the only time they bought Sunshine Lake Pharma shares this year. They previously made an even bigger purchase of HK$49m worth of shares at a price of HK$40.63 per share. That means that even when the share price was higher than HK$36.70 (the recent price), an insider wanted to purchase shares. 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. 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. Yushuai Zhang was the only individual insider to buy during the last year.
Yushuai Zhang purchased 2.85m shares over the year. The average price per share was HK$39.64. 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!
See our latest analysis for Sunshine Lake Pharma
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).
Does Sunshine Lake Pharma Boast High 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. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Sunshine Lake Pharma insiders own 0.6% of the company, worth about HK$118m. 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 Does This Data Suggest About Sunshine Lake Pharma Insiders?
The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. But we don't feel the same about the fact the company is making losses. When combined with notable insider ownership, these factors suggest Sunshine Lake Pharma insiders are well aligned, and quite possibly think the share price is too low. That's what I like to see! 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. While conducting our analysis, we found that Sunshine Lake Pharma has 1 warning sign and it would be unwise to ignore this.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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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