Viewing insider transactions for China Jo-Jo Drugstores, Inc.'s (NASDAQ:CJJD ) over the last year, we see that insiders were net buyers. This means that a larger number of shares were purchased by insiders in relation to shares sold.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for China Jo-Jo Drugstores

China Jo-Jo Drugstores Insider Transactions Over The Last Year

The Chairman & CEO Lei Liu made the biggest insider purchase in the last 12 months. That single transaction was for US$4.7m worth of shares at a price of US$1.87 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$1.83). Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. The only individual insider to buy over the last year was Lei Liu.

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!

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).

Does China Jo-Jo Drugstores Boast High Insider Ownership?

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. China Jo-Jo Drugstores insiders own about US$5.7m worth of shares (which is 45% 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 Do The China Jo-Jo Drugstores Insider Transactions Indicate?

It's certainly positive to see the recent insider purchase. And the longer term insider transactions also give us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about China Jo-Jo Drugstores. 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. Case in point: We've spotted 4 warning signs for China Jo-Jo Drugstores you should be aware of, and 3 of them are potentially serious.