Feiyang International Holdings Group's Market Cap Drops To HK$102m Leaving Insiders With Losses

The recent 14% drop in Feiyang International Holdings Group Limited's (HKG:1901) stock could come as a blow to insiders who purchased CN¥15.3m worth of stock at an average buy price of CN¥1.10 over the past 12 months. Insiders buy with the expectation to see their investments rise in value over a period of time. However, recent losses have rendered their above investment worth CN¥1.70m which is not ideal.

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.

View our latest analysis for Feiyang International Holdings Group

The Last 12 Months Of Insider Transactions At Feiyang International Holdings Group

In the last twelve months, the biggest single purchase by an insider was when Non-Executive Director Yang Shen bought HK$5.3m worth of shares at a price of HK$1.05 per share. That means that even when the share price was higher than HK$0.12 (the recent price), an insider wanted to purchase shares. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. To us, it's very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. We note that Yang Shen was both the biggest buyer and the biggest seller.

Happily, we note that in the last year insiders paid HK$15m for 13.95m shares. But they sold 16.05m shares for HK$3.3m. In the last twelve months there was more buying than selling by Feiyang International Holdings Group insiders. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Insiders At Feiyang International Holdings Group Have Sold Stock Recently

Over the last three months, we've seen significant insider selling at Feiyang International Holdings Group. In total, Non-Executive Director Yang Shen sold HK$3.3m worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Insider Ownership Of Feiyang International Holdings Group

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that Feiyang International Holdings Group insiders own 40% of the company, worth about HK$41m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At Feiyang International Holdings Group Tell Us?

An insider hasn't bought Feiyang International Holdings Group stock in the last three months, but there was some selling. But we take heart from prior transactions. And insider ownership remains quite considerable. So we're not too bothered by recent selling. 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. To that end, you should learn about the 4 warning signs we've spotted with Feiyang International Holdings Group (including 1 which is significant).

But note: Feiyang International Holdings Group 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.