Insiders At Techtronic Industries Sold US$85m In Stock, Alluding To Potential Weakness

The fact that multiple Techtronic Industries Company Limited (HKG:669) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for Techtronic Industries

The Last 12 Months Of Insider Transactions At Techtronic Industries

The Group Executive Vice Chairman, Stephan Horst Pudwill, made the biggest insider sale in the last 12 months. That single transaction was for HK$37m worth of shares at a price of HK$99.31 each. That means that even when the share price was below the current price of HK$102, an insider wanted to cash in some shares. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent 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 just 1.0% of Stephan Horst Pudwill's stake.

Over the last year, we can see that insiders have bought 255.00k shares worth HK$26m. On the other hand they divested 850.00k shares, for HK$85m. Over the last year we saw more insider selling of Techtronic Industries shares, than buying. 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!

For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.

Does Techtronic Industries 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. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that Techtronic Industries insiders own 25% of the company, worth about HK$47b. 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 Do The Techtronic Industries Insider Transactions Indicate?

There haven't been any insider transactions in the last three months -- that doesn't mean much. While we feel good about high insider ownership of Techtronic Industries, we can't say the same about the selling of shares. Of course, the future is what matters most. So if you are interested in Techtronic Industries, you should check out this free report on analyst forecasts for the company.

Of course Techtronic Industries may not be the best stock to buy. So you may wish to see this free collection of high quality 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.