Insiders Relieved After Selling Plus Group Holdings With 13% Price Dip

Insiders seem to have made the most of their holdings by selling CN¥3.0m worth of Plus Group Holdings Inc. (HKG:2486) stock at an average sell price of CN¥2.00 during the past year. The company's market valuation decreased by HK$127m after the stock price dropped 13% over the past week, but insiders were spared from painful losses.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Plus Group Holdings

Plus Group Holdings Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the insider, Jingtang Xia, sold HK$2.0m worth of shares at a price of HK$2.00 per share. That means that an insider was selling shares at slightly below the current price (HK$7.19). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 8.2% of Jingtang Xia's holding. Jingtang Xia was the only individual insider to sell shares in the last twelve months.

Jingtang Xia sold a total of 1.49m shares over the year at an average price of CN¥2.00. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

I will like Plus Group Holdings better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Does Plus Group Holdings Boast High Insider Ownership?

Many investors like to check how much of a company is owned by 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. Plus Group Holdings insiders own 69% of the company, currently worth about HK$573m based on the recent share price. 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 Do The Plus Group Holdings Insider Transactions Indicate?

There haven't been any insider transactions in the last three months -- that doesn't mean much. While we feel good about high insider ownership of Plus Group Holdings, we can't say the same about the selling of shares. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 2 warning signs for Plus Group Holdings you should be aware of, and 1 of these is potentially serious.

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.