Huakang Biomedical Holdings Insiders Who Sold Avert HK$11m Market Cap Dip

Insiders at Huakang Biomedical Holdings Company Limited (HKG:8622) sold CN¥12m worth of stock at an average price of CN¥0.08 a share over the past year, making the most of their investment. The company’s market cap plunged by HK$11m after price dropped by 13% last week but insiders were able to limit their loss to an extent.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

View our latest analysis for Huakang Biomedical Holdings

The Last 12 Months Of Insider Transactions At Huakang Biomedical Holdings

Over the last year, we can see that the biggest insider sale was by the Vice Chairman of King Grace Company Limited, Yim Yang Chang, for HK$3.2m worth of shares, at about HK$0.049 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of HK$0.14. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was 100% of Yim Yang Chang's holding.

Huakang Biomedical Holdings insiders didn't buy any shares over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

I will like Huakang Biomedical Holdings better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Insider Ownership Of Huakang Biomedical Holdings

Many investors like to check how much of a company is owned by 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. Insiders own 30% of Huakang Biomedical Holdings shares, worth about HK$21m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Huakang Biomedical Holdings Insiders?

It doesn't really mean much that no insider has traded Huakang Biomedical Holdings shares in the last quarter. Our analysis of Huakang Biomedical Holdings insider transactions leaves us cautious. But we do like the fact that insiders own a fair chunk of the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Huakang Biomedical Holdings. To help with this, we've discovered 4 warning signs (2 make us uncomfortable!) that you ought to be aware of before buying any shares in Huakang Biomedical Holdings.

But note: Huakang Biomedical Holdings 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. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.