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Q & M Dental Group (Singapore) Limited provides private dental healthcare services. Q & M Dental Group (Singapore)’s insiders have invested 404,600 shares in the small-cap stocks within the past three months. Generally, insiders buying more shares in their own firm sends a bullish signal. The MIT Press (1998) published an article showing that stocks following insider buying outperformed the market by 4.5%. However, it may not be sufficient to base your investment decision merely on these signals. I’ve assessed two potential reasons behind the insiders’ latest motivation to buy more shares.
Check out our latest analysis for Q & M Dental Group (Singapore)
Who Are Ramping Up Their Shares?
Over the past three months, more shares have been bought than sold by Q & M Dental Group (Singapore)’s’ insiders. In total, individual insiders own over 118 million shares in the business, which makes up around 14.93% of total shares outstanding. .
The entity that bought on the open market in the last three months was
Quan Min Holdings Pte Ltd.. Although this is an institutional investor, rather than a company executive or board member, the insights gained from direct access to management as a large investor would make it more well-informed than the average retail investor. In this specific instance, I would classify this investor as a company insider.
Does Buying Activity Reflect Future Growth?
From the outside, Q & M Dental Group (Singapore)’s future looks very positive. Digging deeper into the line items,Q & M Dental Group (Singapore) is expected to experience an impressive double-digit top-line growth next year, which has not flown down into earnings expectations based on its big negative growth rate. This illustrate high cost growth relative to incoming revenues, and could indicate a time of investment and growth in the company. Insiders’ net buying activities seem to bolster the idea of growth moving forward. Or they may simply view the current share price as too low relative to its intrinsic value.
Can Share Price Volatility Explain The Buy?
Another factor we should consider is whether the timing of these insider transactions coincide with any significant share price movements. Volatility provides an opportunity to trade on market inefficiencies when the stock is under-priced compared to the stock’s intrinsic value. Q & M Dental Group (Singapore)’s shares ranged between SGD0.64 and SGD0.52 over the past three months. This indicates reasonable volatility with a change of 23.08%. Insiders’ purchases may not be driven by this movement but perhaps their view of the company’s growth in the future or simply their individual portfolio rebalancing.