Insider Stock Buying Reaches CN¥155.1m On China Strategic Technology Group

Over the last year, a good number of insiders have significantly increased their holdings in China Strategic Technology Group Limited (HKG:1725). This is encouraging because it indicates that insiders are more optimistic about the company's prospects.

Although we don't think shareholders should simply follow insider transactions, 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 China Strategic Technology Group

The insider Yue Ren made the biggest insider purchase in the last 12 months. That single transaction was for HK$65m worth of shares at a price of HK$0.65 each. That means that an insider was happy to buy shares at above the current price of HK$0.60. It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

In the last twelve months insiders purchased 260.93m shares for HK$155m. But insiders sold 71.00m shares worth HK$46m. In total, China Strategic Technology Group insiders bought more than they sold over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

View our latest analysis for China Strategic Technology Group

China Strategic Technology Group 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.

Insiders At China Strategic Technology Group Have Bought Stock Recently

There has been significantly more insider buying, than selling, at China Strategic Technology Group, over the last three months. In fact, two insiders bought HK$90m worth of shares. On the other hand, insiders netted HK$46m by selling. Insiders have spent more buying shares than they have selling, so on balance we think they are are probably optimistic.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 32% of China Strategic Technology Group shares, worth about HK$157m. 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 China Strategic Technology Group Insiders?

The recent insider purchases are heartening. 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 China Strategic Technology Group. Looks promising! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing China Strategic Technology Group. For example, China Strategic Technology Group has 4 warning signs (and 3 which make us uncomfortable) we think you should know about.

But note: China Strategic Technology Group 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.