In This Article:
Yoma Strategic Holdings Ltd., an investment holding company, engages in real estate, automotive and heavy equipment, consumer, tourism, and agriculture businesses in Myanmar and the People’s Republic of China. Yoma Strategic Holdings’s insiders have invested more than 65 million shares in the small-cap stocks within the past three months. It is widely considered that insider buying stock in their own companies is potentially a bullish signal. A research published in The MIT Press (1998) concluded that stocks following insider buying outperformed the market by 4.5%. But these signals may not be sufficient to gain confidence on whether to invest. I’ve analysed two possible reasons driving the insiders’ decision to ramp up their investment of late.
View our latest analysis for Yoma Strategic Holdings
Who Are Ramping Up Their Shares?
More shares have been bought than sold by Yoma Strategic Holdings insiders in the past three months. In total, individual insiders own over 664 million shares in the business, which makes up around 35.04% of total shares outstanding. .
The entity that bought on the open market in the last three months was
Eaton Vance Management. 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.
Is This Consistent With Future Growth?
From the outside, Yoma Strategic Holdings’s future looks hopeful. Delving deeper into the line items,Yoma Strategic Holdings is expected to experience a strong double-digit revenue growth next year, which does not seem to flow into earnings given the highly negative growth expectations. This illustrates high cost growth relative to incoming revenues, and could portray times of high investment and growth in the company. This seems to be supported by insiders’ conviction illustrated by their net buying activities. Or else they may simply deem the company as undervalued by the market based on future growth it could produce.
Did Insiders Buy On Share Price Volatility?
Alternatively, the timing of these insider transactions may have been driven by share price volatility. This means, if insiders believe shares were heavily undervalued recently, this would provide a prime opportunity to buy more irrespective of its growth outlook. In the past three months, Yoma Strategic Holdings’s share price reached a high of SGD0.53 and a low of SGD0.41. This indicates reasonable volatility with a change of 29.27%. Perhaps not a significant enough movement to warrant transactions, thus motivation may be a result of their belief in the company in the future or simply personal portfolio rebalancing.