Have Zhengwei Group Holdings Insiders Been Selling Stock?

Anyone interested in Zhengwei Group Holdings Company Limited (HKG:2147) should probably be aware that the Executive Director, Qiuyun Lin, recently divested HK$2.0m worth of shares in the company, at an average price of HK$0.22 each. However, the silver lining is that the sale only reduced their total holding by 8.8%, so we're hesitant to read anything much into it, on its own.

See our latest analysis for Zhengwei Group Holdings

Zhengwei Group Holdings Insider Transactions Over The Last Year

In fact, the recent sale by Qiuyun Lin was the biggest sale of Zhengwei Group Holdings shares made by an insider individual in the last twelve months, according to our records. So we know that an insider sold shares at around the present share price of HK$0.21. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. 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.

Qiuyun Lin divested 13.38m shares over the last 12 months at an average price of CN¥0.22. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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Insider Ownership Of Zhengwei Group Holdings

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. It's great to see that Zhengwei Group Holdings insiders own 42% of the company, worth about HK$70m. 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 Zhengwei Group Holdings Insiders?

An insider hasn't bought Zhengwei Group Holdings stock in the last three months, but there was some selling. And there weren't any purchases to give us comfort, over the last year. On the plus side, Zhengwei Group Holdings makes money, and is growing profits. 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. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. To help with this, we've discovered 3 warning signs (1 makes us a bit uncomfortable!) that you ought to be aware of before buying any shares in Zhengwei Group Holdings.

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.