Shareholders Can't Ignore HK$37m Of Sales By Super Strong Holdings Insiders

Even though Super Strong Holdings Limited (HKG:8262) stock gained 15% last week, insiders who sold HK$37m worth of stock over the past year are probably better off. Holding on to stock would have meant their investment would be worth less now than it was at the time of sale. Thus selling at an average price of HK$0.19, which is higher than the current price, may have been the best decision.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Super Strong Holdings

The Last 12 Months Of Insider Transactions At Super Strong Holdings

The insider, Chun Hay Ko, made the biggest insider sale in the last 12 months. That single transaction was for HK$26m worth of shares at a price of HK$0.28 each. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The good news is that this large sale was at well above current price of HK$0.03. So it may not tell us anything about how insiders feel about the current share price.

In total, Super Strong Holdings insiders sold more than they bought over the last year. 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!

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

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. Super Strong Holdings insiders own 44% of the company, currently worth about HK$11m based on the recent share price. 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 Super Strong Holdings Insiders?

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 Super Strong Holdings, we can't say the same about the selling of shares. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Super Strong Holdings. While conducting our analysis, we found that Super Strong Holdings has 3 warning signs and it would be unwise to ignore these.

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.