Trade Alert: Non-Executive Director Of Tongcheng Travel Holdings Jianzhang Liang Has Sold Stock

We wouldn't blame Tongcheng Travel Holdings Limited (HKG:780) shareholders if they were a little worried about the fact that Jianzhang Liang, the Non-Executive Director recently netted about HK$21m selling shares at an average price of HK$12.16. Probably the most concerning element of the whole transaction is that the disposal amounted to 100% of their entire holding.

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The Last 12 Months Of Insider Transactions At Tongcheng Travel Holdings

Notably, that recent sale by Jianzhang Liang is the biggest insider sale of Tongcheng Travel Holdings shares that we've seen in the last year. That means that an insider was selling shares at slightly below the current price (HK$12.51). 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. 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 100% of Jianzhang Liang's stake.

Insiders in Tongcheng Travel Holdings didn't buy any shares in 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 Tongcheng Travel Holdings

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Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Tongcheng Travel Holdings insiders own 1.1% of the company, worth about HK$326m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At Tongcheng Travel Holdings Tell Us?

Insiders haven't bought Tongcheng Travel Holdings stock in the last three months, but there was some selling. And there weren't any purchases to give us comfort, over the last year. On the plus side, Tongcheng Travel Holdings makes money, and is growing profits. It is good to see high insider ownership, but the insider selling leaves us cautious. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. At Simply Wall St, we found 1 warning sign for Tongcheng Travel Holdings that deserve your attention before buying any shares.

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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.