Quite a few insiders have dramatically grown their holdings in Far East Hotels and Entertainment Limited (HKG:37) over the past 12 months. An insider’s optimism about the company’s prospects is a positive sign.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Far East Hotels and Entertainment Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Chairman Derek Chiu bought HK$5.7m worth of shares at a price of HK$0.48 per share. That means that an insider was happy to buy shares at around the current price of HK$0.52. 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 do always like to see insider buying, but it is worth noting if those purchases were made at well below today’s share price, as the discount to value may have narrowed with the rising price. The good news for Far East Hotels and Entertainment share holders is that insiders were buying at near the current price.
In the last twelve months Far East Hotels and Entertainment insiders were buying shares, but not selling. 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!
View our latest analysis for Far East Hotels and Entertainment
Far East Hotels and Entertainment is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.
Does Far East Hotels and Entertainment Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it’s a good sign if insiders own a significant number of shares in the company. Insiders own 28% of Far East Hotels and Entertainment shares, worth about HK$109m. We’ve certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At Far East Hotels and Entertainment Tell Us?
The fact that there have been no Far East Hotels and Entertainment insider transactions recently certainly doesn’t bother us. However, our analysis of transactions over the last year is heartening. It would be great to see more insider buying, but overall it seems like Far East Hotels and Entertainment insiders are reasonably well aligned (owning significant chunk of the company’s shares) and optimistic for the future. So these insider transactions can help us build a thesis about the stock, but it’s also worthwhile knowing the risks facing this company. Case in point: We’ve spotted 3 warning signs for Far East Hotels and Entertainment you should be aware of, and 1 of them is concerning.
Of course Far East Hotels and Entertainment 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 of direct interests only, but not derivative transactions or indirect interests.
New: AI Stock Screener & Alerts
Our new AI Stock Screener scans the market every day to uncover opportunities.
• Dividend Powerhouses (3%+ Yield)
• Undervalued Small Caps with Insider Buying
• High growth Tech and AI Companies
Or build your own from over 50 metrics.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
‘ The preceding article may include information circulated by third parties ’
‘ Some details of this article were extracted from the following source simplywall.st ’
