Selling HK.AI Capital Shares at a Lower Price Than Current Market Value May Have Been a Costly Mistake for Insiders

HK.AI Capital Limited's (HKG:1140) value has fallen 15% in the last week, but insiders who sold HK$5.1m worth of stock over the last year have had less success. Insiders might have been better off holding onto their shares, given that the average selling price of HK$0.23 is still below the current share price.

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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The Last 12 Months Of Insider Transactions At HK.AI Capital

Over the last year, we can see that the biggest insider sale was by the insider, Fang Yang, for HK$3.0m worth of shares, at about HK$0.22 per share. 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$0.14. So it is hard to draw any strong conclusion from it. The only individual insider seller over the last year was Fang Yang. Notably Fang Yang was also the biggest buyer, having purchased HK$717k worth of shares.

Happily, we note that in the last year insiders paid HK$717k for 3.42m shares. But they sold 22.38m shares for HK$5.1m. Fang Yang divested 22.38m shares over the last 12 months at an average price of HK$0.23. 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 HK.AI Capital

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

Insider Ownership

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 14% of HK.AI Capital shares, worth about HK$235m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Do The HK.AI Capital Insider Transactions Indicate?

There haven't been any insider transactions in the last three months -- that doesn't mean much. It's great to see high levels of insider ownership, but looking back over the last year, we don't gain confidence from the HK.AI Capital 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. You'd be interested to know, that we found 1 warning sign for HK.AI Capital and we suggest you have a look.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.