Insiders Could Have Profited By Holding onto Brightstar Technology Group Shares Despite 11% Drop

Even though Brightstar Technology Group Co., Ltd. (HKG:8446) has fallen by 11% over the past week , insiders who sold HK$55m worth of stock over the past year have had less luck. Insiders would probably have been better off holding on to their shares given that the average selling price of HK$0.45 is still lower than the current share price.

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.

View our latest analysis for Brightstar Technology Group

The Last 12 Months Of Insider Transactions At Brightstar Technology Group

Over the last year, we can see that the biggest insider sale was by the insider, Lie Ma, for HK$55m worth of shares, at about 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 good news is that this large sale was at well above current price of HK$0.16. So it may not tell us anything about how insiders feel about the current share price. Lie Ma was the only individual insider to sell over the last year.

Happily, we note that in the last year insiders paid HK$52m for 116.10m shares. But insiders sold 124.49m shares worth HK$55m. 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!

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Insider Ownership

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. Brightstar Technology Group insiders own about HK$60m worth of shares (which is 41% 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 Brightstar Technology Group Insiders?

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 Brightstar Technology Group, we can't say the same about the selling of shares. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. In terms of investment risks, we've identified 4 warning signs with Brightstar Technology Group and understanding them should be part of your investment process.

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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.