Don't Ignore The Insider Selling In Walnut Capital

Anyone interested in Walnut Capital Limited (HKG:905) should probably be aware that the CEO & Executive Director, Bun Man Mung, recently divested HK$996k worth of shares in the company, at an average price of HK$1.83 each. However, the silver lining is that the sale only reduced their total holding by 0.09%, so we're hesitant to read anything much into it, on its own.

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The Last 12 Months Of Insider Transactions At Walnut Capital

Notably, that recent sale by CEO & Executive Director Bun Man Mung was not the only time they sold Walnut Capital shares this year. They previously made an even bigger sale of -HK$3.6m worth of shares at a price of HK$1.71 per share. That means that an insider was selling shares at slightly below the current price (HK$1.85). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was just 0.4% of Bun Man Mung's stake.

Bun Man Mung divested 3.82m shares over the last 12 months at an average price of HK$1.75. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart 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 Walnut Capital

I will like Walnut Capital 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.

Does Walnut Capital Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Walnut Capital insiders own about HK$1.1b worth of shares (which is 56% 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.

So What Does This Data Suggest About Walnut Capital Insiders?

An insider hasn't bought Walnut Capital stock in the last three months, but there was some selling. And even if we look at the last year, we didn't see any purchases. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. 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. When we did our research, we found 3 warning signs for Walnut Capital (1 can't be ignored!) that we believe deserve your full attention.

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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.