Trade Alert: Executive Co-Chairman of the Board & Company Secretary Of Basetrophy Group Holdings Kui Ming Chan Has Sold Stock

Some Basetrophy Group Holdings Limited (HKG:8460) shareholders may be a little concerned to see that the Executive Co-Chairman of the Board & Company Secretary, Kui Ming Chan, recently sold a substantial HK$24m worth of stock at a price of HK$0.47 per share. Probably the most concerning element of the whole transaction is that the disposal amounted to 99% of their entire holding.

AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early.

The Last 12 Months Of Insider Transactions At Basetrophy Group Holdings

Notably, that recent sale by Kui Ming Chan is the biggest insider sale of Basetrophy Group Holdings shares that we've seen in the last year. That means that an insider was selling shares at slightly below the current price (HK$0.55). 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. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was 99% of Kui Ming Chan's holding.

In total, Basetrophy Group Holdings insiders sold more than they bought 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!

View our latest analysis for Basetrophy Group Holdings

If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.

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. Basetrophy Group Holdings insiders own about HK$62m worth of shares (which is 51% of the company). Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Do The Basetrophy Group Holdings Insider Transactions Indicate?

The stark truth for Basetrophy Group Holdings is that there has been more insider selling than insider buying in the last three months. Zooming out, the longer term picture doesn't give us much comfort. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. 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. Our analysis shows 4 warning signs for Basetrophy Group Holdings (2 can't be ignored!) and we strongly recommend you look at these before investing.

But note: Basetrophy Group Holdings 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.