China Golden Classic Group Stock Down 10.0% But Insiders Still In CN¥657k Profit

Insiders who bought China Golden Classic Group Limited (HKG:8281) in the last 12 months may probably not pay attention to the stock's recent 10.0% drop. Reason being, despite the recent loss, insiders original purchase value of CN¥2.58m is now worth CN¥3.24m.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for China Golden Classic Group

The Last 12 Months Of Insider Transactions At China Golden Classic Group

In the last twelve months, the biggest single purchase by an insider was when Executive Chairman & Compliance Officer Qiuyan Li bought HK$2.6m worth of shares at a price of HK$0.14 per share. We do like to see buying, but this purchase was made at well below the current price of HK$0.18. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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

Insider Ownership Of China Golden Classic Group

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. China Golden Classic Group insiders own about HK$126m worth of shares (which is 70% 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 Does This Data Suggest About China Golden Classic Group Insiders?

It is good to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. Once you factor in the high insider ownership, it certainly seems like insiders are positive about China Golden Classic Group. One for the watchlist, at least! 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 assist with this, we've discovered 1 warning sign that you should run your eye over to get a better picture of China Golden Classic Group.

But note: China Golden Classic 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.