Guanze Medical Information Industry (Holding) Insiders Benefit From Selling Stock At CN¥0.43

While Guanze Medical Information Industry (Holding) Co., Ltd. (HKG:2427) shareholders have enjoyed a good week with stock up 14%, they need remain vigilant. Even though stock prices were relatively low, insiders elected to sell CN¥1.5m worth of stock in the last year, which could indicate some expected downturn.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

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Guanze Medical Information Industry (Holding) Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the CEO & Chairman, Xianzhen Meng, sold HK$545k worth of shares at a price of HK$0.41 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of HK$0.67. 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. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. We note that the biggest single sale was only 0.2% of Xianzhen Meng's holding. Xianzhen Meng was the only individual insider to sell over the last year.

Xianzhen Meng sold a total of 3.49m shares over the year at an average price of CN¥0.43. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

See our latest analysis for Guanze Medical Information Industry (Holding)

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Insider Ownership Of Guanze Medical Information Industry (Holding)

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that Guanze Medical Information Industry (Holding) insiders own 74% of the company, worth about HK$469m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Guanze Medical Information Industry (Holding) Insiders?

The fact that there have been no Guanze Medical Information Industry (Holding) 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 Guanze Medical Information Industry (Holding) insiders selling. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For instance, we've identified 3 warning signs for Guanze Medical Information Industry (Holding) (2 can't be ignored) you should be aware of.

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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.