Insiders Of Redco Properties Group Retain CN¥8.4m Of Investment Selling At Higher Prices

While Redco Properties Group Limited (HKG:1622) shareholders have enjoyed a good week with stock up 11%, they need remain vigilant. Even though stock prices were relatively low, insiders elected to sell CN¥8.4m worth of stock in the last year, which could indicate some expected downturn.

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 Redco Properties Group

The insider, Leung Ho Ng, made the biggest insider sale in the last 12 months. That single transaction was for HK$8.4m worth of shares at a price of HK$0.062 each. So it's clear an insider wanted to take some cash off the table, even below the current price of HK$0.18. 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. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. We note that the biggest single sale was only 43% of Leung Ho Ng's holding. Leung Ho Ng was the only individual insider to sell shares in the last twelve months.

The chart below shows insider transactions (by companies and individuals) over the last year. 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 Redco Properties Group

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 Of Redco Properties Group

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Redco Properties Group insiders own 72% of the company, currently worth about HK$451m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Do The Redco Properties Group Insider Transactions Indicate?

The fact that there have been no Redco Properties Group insider transactions recently certainly doesn't bother us. It's great to see high levels of insider ownership, but looking back over the last year, we don't gain confidence from the Redco Properties Group insiders selling. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Redco Properties Group. When we did our research, we found 5 warning signs for Redco Properties Group (3 shouldn't be ignored!) that we believe deserve your full attention.

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.