Yahoo Finance Insiders Of Alset Reap Rewards After Their Investment Jumps Another US$490k
Alset Inc. (NASDAQ:AEI) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 14%, resulting in a US$1.4m rise in the company's market capitalisation, translating to a gain of 45% on their initial investment. In other words, the original US$1.08m purchase is now worth US$1.57m.
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.
Check out our latest analysis for Alset
The Last 12 Months Of Insider Transactions At Alset
In fact, the recent purchase by Founder Heng Fai Chan was not their only acquisition of Alset shares this year. Earlier in the year, they paid US$0.74 per share in a US$199k purchase. Even though the purchase was made at a significantly lower price than the recent price (US$1.26), 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.
Heng Fai Chan bought 1.25m shares over the last 12 months at an average price of US$0.87. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insider Ownership Of Alset
For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Alset insiders own 64% of the company, currently worth about US$7.5m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
What Might The Insider Transactions At Alset Tell Us?
The recent insider purchase is heartening. And the longer term insider transactions also give us confidence. But we don't feel the same about the fact the company is making losses. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Alset. Looks promising! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For instance, we've identified 3 warning signs for Alset (1 is a bit unpleasant) you should be aware of.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.
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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.
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