China Changbaishan International Holdings Up 13%, But Some Insiders Miss Out

Even though China Changbaishan International Holdings Limited (HKG:989) stock gained 13% last week, insiders who sold CN¥1.3m worth of stock over the past year are probably better off. Selling at an average price of CN¥1.15, which is higher than the current price, may have been the best move for these insiders because their investment would have been worth less now than when they sold.

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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The Last 12 Months Of Insider Transactions At China Changbaishan International Holdings

Over the last year, we can see that the biggest insider sale was by the insider, Xintong Cui, for HK$1.2m worth of shares, at about HK$1.21 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is HK$0.81. So it may not shed much light on insider confidence at current levels. The only individual insider seller over the last year was Xintong Cui.

Xintong Cui sold a total of 1.10m shares over the year at an average price of CN¥1.15. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

See our latest analysis for China Changbaishan International Holdings

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Insider Ownership

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that China Changbaishan International Holdings insiders own 43% of the company, worth about HK$125m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Does This Data Suggest About China Changbaishan International Holdings Insiders?

It doesn't really mean much that no insider has traded China Changbaishan International Holdings shares in the last quarter. It's heartening that insiders own plenty of stock, but we'd like to see more insider buying, since the last year of China Changbaishan International Holdings insider transactions don't fill us with confidence. 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. Case in point: We've spotted 4 warning signs for China Changbaishan International Holdings you should be aware of, and 3 of them are potentially serious.

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.