For Huanxi Media Group Insiders, Selling HK$62m Of Shares Was A Smart Move

While Huanxi Media Group Limited (HKG:1003) shareholders have had a good week with the stock up 33%, they shouldn't let their guards down. The fact that insiders chose to dispose of HK$62m worth of stock in the past 12 months even though prices were relatively low could be indicative of some anticipated weakness.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

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The Last 12 Months Of Insider Transactions At Huanxi Media Group

In the last twelve months, the biggest single sale by an insider was when the insider, Ping Dong, sold HK$9.6m worth of shares at a price of HK$0.45 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The silver lining is that this sell-down took place above the latest price (HK$0.39). So it may not shed much light on insider confidence at current levels. Ping Dong was the only individual insider to sell shares in the last twelve months. Notably Ping Dong was also the biggest buyer, having purchased HK$2.4m worth of shares.

Ping Dong sold a total of 187.31m shares over the year at an average price of HK$0.33. 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!

View our latest analysis for Huanxi Media Group

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Huanxi Media Group Insiders Are Selling The Stock

We've seen more insider selling than insider buying at Huanxi Media Group recently. In that time, insider Ping Dong dumped HK$22m worth of shares. Meanwhile insider Ping Dong bought HK$1.9m worth. The share price has moved a bit recently, but it's hard to argue that the selling is a positive.

Insider Ownership Of Huanxi Media Group

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. Insiders own 35% of Huanxi Media Group shares, worth about HK$496m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Huanxi Media Group Insiders?

The stark truth for Huanxi Media Group is that there has been more insider selling than insider buying in the last three months. Zooming out, the longer term picture doesn't give us much comfort. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Huanxi Media Group. Every company has risks, and we've spotted 3 warning signs for Huanxi Media Group (of which 2 don't sit too well with us!) you should know about.

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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.