Insider Sellers Might Regret Selling Zhixin Group Holding Shares at a Lower Price Than Current Market Value

Zhixin Group Holding Limited's (HKG:2187) value has fallen 10% in the last week, but insiders who sold CN¥5.4m worth of stock over the last year have had less success. Given that the average selling price of CN¥0.94 is still lower than the current share price, insiders would probably have been better off keeping their shares.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

The Last 12 Months Of Insider Transactions At Zhixin Group Holding

The Executive Director, Dan Ye, made the biggest insider sale in the last 12 months. That single transaction was for HK$5.4m worth of shares at a price of HK$0.94 each. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The good news is that this large sale was at well above current price of HK$0.48. So it may not tell us anything about how insiders feel about the current share price. Dan Ye was the only individual insider to sell over the last year.

You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

See our latest analysis for Zhixin Group Holding

For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.

Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Zhixin Group Holding insiders own about HK$220m worth of shares (which is 61% 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.

What Might The Insider Transactions At Zhixin Group Holding Tell Us?

The fact that there have been no Zhixin Group Holding insider transactions recently certainly doesn't bother us. While we feel good about high insider ownership of Zhixin Group Holding, we can't say the same about the selling of shares. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To that end, you should learn about the 6 warning signs we've spotted with Zhixin Group Holding (including 2 which are concerning).

Of course Zhixin Group Holding may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

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.