Investors who take an interest in QAF Limited( SGX:Q01 ) should definitely note that the Joint Group MD & Executive Director, Kejian Lin, recently paid S$0.91 per share to buy S$620k worth of the stock. That's a very decent purchase to our minds and it grew their holding by a solid 11%.
QAF Insider Transactions Over The Last Year
In fact, the recent purchase by Kejian Lin was the biggest purchase of QAF shares made by an insider individual in the last twelve months, according to our records. That means that an insider was happy to buy shares at around the current price of S$0.93. Of course they may have changed their mind. But this suggests they are optimistic. 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 QAF share holders is that an insider was buying at near the current price. Kejian Lin was the only individual insider to buy during the last year.
Kejian Lin purchased 1.31m shares over the year. The average price per share was S$0.90. 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!
View our latest analysis for QAF
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
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. QAF insiders own about S$280m worth of shares (which is 52% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
So What Does This Data Suggest About QAF Insiders?
The recent insider purchase is heartening. And the longer term insider transactions also give us confidence. Once you factor in the high insider ownership, it certainly seems like insiders are positive about QAF. Looks promising! So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Case in point: We've spotted 2 warning signs for QAF you should be aware of, and 1 of these doesn't sit too well with us.
But note: QAF 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.
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