China Frontier Technology Group Falls To HK$1.53, But Insiders Sold At Lower Price

China Frontier Technology Group's (HKG:1661) stock price has dropped 16% in the previous week, but insiders who sold CN¥3.5m in stock over the past year have had less luck. Insiders might have been better off holding onto their shares, given that the average selling price of CN¥1.91 is still below the current share price.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

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China Frontier Technology Group Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the insider, Meizhen Wu, sold HK$3.5m worth of shares at a price of HK$1.91 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The silver lining is that this sell-down took place above the latest price (HK$1.53). So it is hard to draw any strong conclusion from it. Meizhen Wu was the only individual insider to sell over the last year.

You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

See our latest analysis for China Frontier Technology Group

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China Frontier Technology Group Insiders Are Selling The Stock

The last three months saw significant insider selling at China Frontier Technology Group. In total, insider Meizhen Wu dumped HK$3.5m worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.

Does China Frontier Technology Group Boast High Insider Ownership?

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. It's great to see that China Frontier Technology Group insiders own 47% of the company, worth about HK$137m. 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 China Frontier Technology Group Insider Transactions Indicate?

An insider sold China Frontier Technology Group shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For instance, we've identified 5 warning signs for China Frontier Technology Group (3 make us uncomfortable) you should be aware of.

But note: China Frontier Technology Group 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.