Insider Sellers Might Regret Selling Icon Culture Global Shares at a Lower Price Than Current Market Value

Even though Icon Culture Global Company Limited (HKG:8500) has fallen by 18% over the past week , insiders who sold CN¥29m 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 CN¥0.68 is still lower than the current share price.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Icon Culture Global

The Last 12 Months Of Insider Transactions At Icon Culture Global

In fact, the recent sale by Tse To Chow was the biggest sale of Icon Culture Global shares made by an insider individual in the last twelve months, according to our records. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The good news is that this large sale was at well above current price of HK$0.60. So it may not tell us anything about how insiders feel about the current share price.

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

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).

Icon Culture Global Insiders Are Selling The Stock

Over the last three months, we've seen notably more insider selling, than insider buying, at Icon Culture Global. In that time, Founder & Executive Chairman Tse To Chow dumped HK$29m worth of shares. On the other hand we note insider Qiao Yun Zhang bought HK$9.8m worth of shares , as previously mentioned . The share price has moved a bit recently, but it's hard to argue that the selling is a positive.

Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that Icon Culture Global insiders own 63% of the company, worth about HK$81m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Icon Culture Global Insiders?

The insider sales have outweighed the insider buying, at Icon Culture Global, in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. 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 these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For instance, we've identified 6 warning signs for Icon Culture Global (2 are a bit concerning) you should be aware of.

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.