We often see insiders buying up shares in companies that perform well over the long term. On the other hand, we’d be remiss not to mention that insider sales have been known to precede tough periods for a business. So before you buy or sell Uni-Asia Group Limited (SGX:CHJ), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, most countries require that the company discloses such transactions to the market.
We don’t think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year’.
Uni-Asia Group Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Co-Founder & Chairman Michio Tanamoto bought S$174k worth of shares at a price of S$0.43 per share. We do like to see buying, but this purchase was made at well below the current price of S$0.59. Because the shares were purchased at a lower price, this particular buy doesn’t tell us much about how insiders feel about the current share price.
Uni-Asia Group insiders may have bought shares in the last year, but they didn’t sell any. The average buy price was around S$0.48. These transactions show that insiders have confidence to invest their own money in the stock, albeit at slightly below the recent price. 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!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Insiders at Uni-Asia Group Have Bought Stock Recently
It’s good to see that Uni-Asia Group insiders have made notable investments in the company’s shares. We can see that CEO & Executive Director Kenji Fukuyado paid S$72k for shares in the company. No-one sold. This makes one think the business has some good points.
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. Insiders own 17% of Uni-Asia Group shares, worth about S$7.8m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
What Might The Insider Transactions At Uni-Asia Group Tell Us?
It is good to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. However, we note that the company didn’t make a profit over the last twelve months, which makes us cautious. Insiders likely see value in Uni-Asia Group shares, given these transactions (along with notable insider ownership of the company). While we like knowing 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. For instance, we’ve identified 3 warning signs for Uni-Asia Group (1 doesn’t sit too well with us) you should be aware of.
Of course Uni-Asia Group 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, but not derivative transactions.
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This article by Simply Wall St is general in nature. 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.
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