The recent drop in the market capitalization of HKBN Ltd. (HKG:1310) HK$459 million means a loss of HK$312,000 for insiders who bought this year

Insiders who bought for HK$2.1 million of HKBN Ltd. (HKG:1310) at an average buy price of HK$10.56 over the past year may be disappointed with the stock’s recent 3.7% decline. Insiders buy in the hope that their investments will increase in value over time. However, due to recent losses, their initial investment is now only worth HK$1.8 million, which is not huge.

While we would never suggest that investors base their decisions solely on what a company’s directors have done, we think it makes perfect sense to keep tabs on what insiders are doing.

Check out our latest analysis for HKBN

HKBN insider trades over the past year

Independent non-executive chairman Bradley Horwitz made the biggest insider buy in the past 12 months. This single transaction was for HK$2.1 million in shares at a price of HK$10.56 each. It is therefore clear that an insider wanted to buy, even at a price above the current share price (ie HK$9.00). Their perspective may have changed since then, but it at least shows that they were feeling optimistic at the time. For us, it is very important to consider the price that insiders pay for the shares. It is encouraging to see an insider paid above the current stock price, as it suggests that they have perceived value even at higher levels. Bradley Horwitz was the only individual insider to buy in the past year.

You can see a visual representation of insider trading (by companies and individuals) over the past 12 months, below. By clicking on the graph below, you will be able to see the precise detail of each insider trade!

SEHK:1310 Insider Trading Volume April 1, 2022

HKBN isn’t the only stock insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider buying, might be just the ticket.

Insider ownership

Many investors like to check how much a company is owned by insiders. Usually, the higher the insider ownership, the more likely insiders will be incentivized to build the business for the long term. It appears that HKBN insiders own 4.5% of the company, worth around HK$531 million. We have certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest an alignment between insiders and other shareholders.

So what do HKBN insider trades indicate?

It doesn’t mean much that no insider has traded HKBN stock in the last quarter. However, our analysis of transactions over the past year is encouraging. It would be great to see more insider buying, but overall it looks like HKBN insiders are reasonably well-aligned (holding a significant portion of the company’s stock) and optimistic about the future. While we like to know what’s going on with insider ownership and trading, we also make sure to consider the risks a stock faces before making any investment decisions. When we did our research, we found 3 warning signs for HKBN (1 makes us a little uneasy!) which we believe deserve your full attention.

But note: HKBN may not be the best stock to buy. So take a look at this free list of interesting companies with high ROE and low debt.

For the purposes of this article, insiders are persons who report their transactions to the relevant regulatory body. We currently record open market transactions and private dispositions, but not derivative transactions.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.