As the old cliché goes, “The insiders know it best”. Substantial shareholders and directors of a company can be said to understand the ins and outs of their own company better as compared to a retail investor sitting on the sidelines. Thus, many people usually keep an eye on any significant insider trades to gauge the level of confidence the management team or substantial shareholders have in their own company. Consistent insider purchases may indicate an undervalued share price. On the other hand, continuous insider selling without a good reason may be a potential sign of trouble. Let’s…
As the old cliché goes, “The insiders know it best”. Substantial shareholders and directors of a company can be said to understand the ins and outs of their own company better as compared to a retail investor sitting on the sidelines.
Thus, many people usually keep an eye on any significant insider trades to gauge the level of confidence the management team or substantial shareholders have in their own company. Consistent insider purchases may indicate an undervalued share price. On the other hand, continuous insider selling without a good reason may be a potential sign of trouble.
Let’s take a look at three companies with insider money moves in the past week.
Gaylin Holdings Limited (SGX: RF7)
Gaylin Holdings Limited is a multi-disciplinary specialist provider and manufacturer of rigging and lifting solutions to the global offshore oil and gas industry. The Group also provides a wide range of engineering services to its customers who require customization or manufacturing of products specific to their requirements.
Headquartered in Singapore, its production facilities and warehouses are in Singapore, Malaysia, Vietnam and China while its sales markets comprise are in regions such as Asia, Europe, Middle East and Africa.
On separate filings since 2 Jan 2014, it seems that the entire “Teo” family, who are part of Gaylin’s management team, have been stepping up to acquire shares in the company. Teo Bee Chiong, the company’s chief executive, bought a total of 374,000 shares from 2 Jan to 10 Jan. Teo Bee Hoe, Gaylin’s deputy chief operating officer, also increased his deemed interest in the company to 61.874% of the total number of voting shares outstanding through a series of purchases recently
Gaylin Holdings last traded at $0.58 last Friday. It sports a dividend yield of 1.4% with a historical price-to-earnings ratio of 25.
Unionmet Singapore Limited (SGX: A6F)
Few people have heard of Unionmet Singapore even though it has been listed on the Mainboard exchange in Singapore since the end of Jan 2007. Its business operations are primarily located in PRC, Liuzhou. The Group is a leading manufacturer and supplier of indium ingots. It is also engaged in the sale of the zinc by-products derived from its indium slag and strip liquor extraction processes.
In 2011, the group expanded its business scope to include ferrous, non-ferrous, and precious metals; kaolin and barite; and coal and coke.
On 14 Jan, Li Hua, executive chairman of the company, acquired 1.8 million shares (0.29% of Unionmet’s issued capital) at about $0.08094 cents each from the open market. Meanwhile, shares of Unionmet also underwent an off-market transaction where Mdm Weng Huixin purchased 128 million shares under her wholly-owned company – Precious Stream Holdings Limited. As a result, she now has a28.65% deemed interest in Unionmet.
Unionmet had posted a loss for its financial year ended 30 Nov 2013 and does not give out any dividends at the moment. It closed at $0.093 last Friday.
United Envirotech Limited (SGX: U19)
The company is an environmental solution provider focusing on membrane based water and wastewater treatment in China’s chemical, petrochemical and industrial park sectors. Its membrane systems have also been used in pharmaceutical, food and beverage, and textile and dye staff industries. UEL has designed and built several of the largest wastewater treatment plants in Asia using the Membrane Bioreactor (MBR) technology. It also undertakes turn key projects in the capacity of an engineering, procurement and construction contractor or as a membrane system specialist.
During two occasions on 13 January, Tay Beng Chuan, an independent director on the company’s Board, increased his stake in the company from nilto 0.034% by purchasing 102,000 and 98,000 shares separately. United Envirotech is currently trading at a price-to-earnings ratio of 19 and its dividend yield is at 0.5%. Its shares last changed hands at $1.055 last Friday.
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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor James Yeo doesn’t own shares in any companies mentioned.