Possible Bearish Signals With National United Resources Holdings Insiders Disposing Stock

The fact that multiple National United Resources Holdings Limited (HKG:254) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, if numerous insiders are selling, shareholders should investigate more.

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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The Last 12 Months Of Insider Transactions At National United Resources Holdings

The insider, Yuanfan He, made the biggest insider sale in the last 12 months. That single transaction was for HK$33m worth of shares at a price of HK$0.95 each. That means that an insider was selling shares at around the current price of HK$0.88. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign. Notably Yuanfan He was also the biggest buyer, having purchased HK$55m worth of shares.

Over the last year, we can see that insiders have bought 115.00m shares worth HK$55m. On the other hand they divested 89.80m shares, for HK$73m. All up, insiders sold more shares in National United Resources Holdings than they bought, over the last year. The sellers received a price of around HK$0.81, on average. It's not particularly great to see insiders were selling shares at below recent prices. But we wouldn't put too much weight on the insider selling. 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!

View our latest analysis for National United Resources Holdings

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National United Resources Holdings Insiders Are Selling The Stock

Over the last three months, we've seen notably more insider selling, than insider buying, at National United Resources Holdings. In that time, insiders dumped HK$73m worth of shares. Meanwhile insider Yuanfan He bought HK$23m worth. Because the selling vastly outweighs the buying, we'd say this is a somewhat bearish sign.

Insider Ownership Of National United Resources 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. National United Resources Holdings insiders own 48% of the company, currently worth about HK$237m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At National United Resources Holdings Tell Us?

The stark truth for National United Resources Holdings is that there has been more insider selling than insider buying in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. It is good to see high insider ownership, but the insider selling leaves us cautious. 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 5 warning signs for National United Resources Holdings (1 shouldn'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.