This Insider Has Just Sold Shares In Baofeng Modern International Holdings Company Limited (HKG:1121)

We wouldn't blame Baofeng Modern International Holdings Company Limited (HKG:1121) shareholders if they were a little worried about the fact that Hsin-Wang Chiu, a company insider, recently netted about HK$32m selling shares at an average price of HK$0.39. That diminished their holding by a very significant 100%, which arguably implies a strong desire to reallocate capital.

View our latest analysis for Baofeng Modern International Holdings

Baofeng Modern International Holdings Insider Transactions Over The Last Year

Notably, that recent sale by Hsin-Wang Chiu is the biggest insider sale of Baofeng Modern International Holdings shares that we've seen in the last year. That means that even when the share price was below the current price of HK$0.76, an insider wanted to cash in some shares. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. 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. It is worth noting that this sale was 100% of Hsin-Wang Chiu's holding.

The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

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Insider Ownership of Baofeng Modern International Holdings

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Baofeng Modern International Holdings insiders own about HK$659m worth of shares (which is 62% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

What Might The Insider Transactions At Baofeng Modern International Holdings Tell Us?

An insider hasn't bought Baofeng Modern International Holdings stock in the last three months, but there was some selling. Looking to the last twelve months, our data doesn't show any insider buying. It is good to see high insider ownership, but the insider selling leaves us cautious. While we like knowing 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. Case in point: We've spotted 4 warning signs for Baofeng Modern International Holdings you should be aware of, and 2 of these shouldn't be ignored.

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, but not derivative transactions.

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This article by Simply Wall St is general in nature. 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.
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