South Manganese Investment Insider Buyers See Boost After Market Cap Rose HK$185m

South Manganese Investment Limited (HKG:1091) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 16%, resulting in a HK$185m rise in the company's market capitalisation, translating to a gain of 60% on their initial investment. As a result, the stock they originally bought for HK$144.0m is now worth HK$229.7m.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

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The Last 12 Months Of Insider Transactions At South Manganese Investment

The insider Ming Cheung made the biggest insider purchase in the last 12 months. That single transaction was for HK$144m worth of shares at a price of HK$0.21 each. Even though the purchase was made at a significantly lower price than the recent price (HK$0.34), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

View our latest analysis for South Manganese Investment

South Manganese Investment 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.

Does South Manganese Investment 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's great to see that South Manganese Investment insiders own 45% of the company, worth about HK$625m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Does This Data Suggest About South Manganese Investment Insiders?

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 South Manganese Investment. One for the watchlist, at least! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing South Manganese Investment. At Simply Wall St, we found 2 warning signs for South Manganese Investment that deserve your attention before buying any shares.

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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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.