Have China XLX Fertiliser Insiders Been Selling Stock?

Some China XLX Fertiliser Ltd. (HKG:1866) shareholders may be a little concerned to see that the Executive Director, Yunhua Yan, recently sold a substantial HK$9.7m worth of stock at a price of HK$9.70 per share. However, that sale only accounted for 0.4% of their holding, so arguably it doesn't say much about their conviction.

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The Last 12 Months Of Insider Transactions At China XLX Fertiliser

Notably, that recent sale by Executive Director Yunhua Yan was not the only time they traded China XLX Fertiliser shares this year. They previously purchased HK$17m worth of shares at a price of HK$9.79 per share. We do like to see buying, but this purchase was made at well below the current price of HK$10.99. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.

Over the last year, we can see that insiders have bought 4.65m shares worth HK$45m. But they sold 1.00m shares for HK$9.7m. In total, China XLX Fertiliser insiders bought more than they sold over the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

Check out our latest analysis for China XLX Fertiliser

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

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. We usually like to see fairly high levels of insider ownership. It's great to see that China XLX Fertiliser insiders own 20% of the company, worth about HK$3.1b. 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 XLX Fertiliser Insiders?

The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. Once you factor in the high insider ownership, it certainly seems like insiders are positive about China XLX Fertiliser. That's what I like to see! 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've found that China XLX Fertiliser has 2 warning signs (1 is a bit unpleasant!) that deserve your attention before going any further with your analysis.

But note: China XLX Fertiliser 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.