Insider Sellers Might Regret Selling Laekna Shares at a Lower Price Than Current Market Value

Laekna, Inc.'s (HKG:2105) stock price has dropped 10% in the previous week, but insiders who sold CN¥56m in stock over the past year have had less luck. Given that the average selling price of CN¥19.80 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, logic dictates you should pay some attention to whether insiders are buying or selling shares.

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Laekna Insider Transactions Over The Last Year

The CEO & Executive Chairman, Xiangyang Lu, made the biggest insider sale in the last 12 months. That single transaction was for HK$22m worth of shares at a price of HK$20.03 each. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. It's of some comfort that this sale was conducted at a price well above the current share price, which is HK$15.11. So it may not shed much light on insider confidence at current levels. Xiangyang Lu was the only individual insider to sell over the last year.

Xiangyang Lu ditched 2.82m shares over the year. The average price per share was CN¥19.80. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Check out our latest analysis for Laekna

If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.

Does Laekna Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. It's great to see that Laekna insiders own 14% of the company, worth about HK$874m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Do The Laekna Insider Transactions Indicate?

The fact that there have been no Laekna insider transactions recently certainly doesn't bother us. It's great to see high levels of insider ownership, but looking back over the last year, we don't gain confidence from the Laekna insiders selling. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Laekna. Every company has risks, and we've spotted 4 warning signs for Laekna (of which 2 are a bit unpleasant!) you should know about.

But note: Laekna 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.