An Insider At Fenbi Lowered Their Holding Recently

From what we can see, insiders were net sellers in Fenbi Ltd.'s (HKG:2469 ) during the past 12 months. That is, insiders sold the stock in greater numbers than they purchased it.

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 Fenbi

Fenbi Insider Transactions Over The Last Year

The Non-Executive Director, Xin Li, made the biggest insider sale in the last 12 months. That single transaction was for HK$54m worth of shares at a price of HK$4.94 each. So we know that an insider sold shares at around the present share price of HK$4.55. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign. Xin Li was the only individual insider to sell shares in the last twelve months.

Xin Li sold a total of 26.22m shares over the year at an average price of CN¥5.11. 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: insiders have been buying them).

Fenbi Insiders Are Selling The Stock

There was substantially more insider selling, than buying, of Fenbi shares over the last three months. In total, Non-Executive Director Xin Li sold HK$134m worth of shares in that time. On the other hand we note Co-Founder Xiaolong Zhang bought HK$2.0m worth of shares , as previously mentioned . Because the selling vastly outweighs the buying, we'd say this is a somewhat bearish sign.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company 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. Fenbi insiders own 32% of the company, currently worth about HK$3.3b based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

What Might The Insider Transactions At Fenbi Tell Us?

The insider sales have outweighed the insider buying, at Fenbi, in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. 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. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Fenbi. You'd be interested to know, that we found 2 warning signs for Fenbi and we suggest you have a look.

But note: Fenbi 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.