Shareholders Can't Ignore CN¥6.1m Of Sales By Litian Pictures Holdings Insiders

Litian Pictures Holdings Limited's (HKG:9958) stock rose 14% last week, but insiders who sold CN¥6.1m worth of stock over the last year are probably in a more advantageous position. Selling at an average price of CN¥1.40, which is higher than the current price, may have been the best move for these insiders because their investment would have been worth less now than when they sold.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for Litian Pictures Holdings

Litian Pictures Holdings Insider Transactions Over The Last Year

The CFO & Joint Company Secretary, Jieyun Fu, made the biggest insider sale in the last 12 months. That single transaction was for HK$6.1m worth of shares at a price of HK$1.40 each. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is HK$0.15. So it may not tell us anything about how insiders feel about the current share price. Jieyun Fu was the only individual insider to sell over the last year.

You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

I will like Litian Pictures 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 Litian Pictures Holdings Boast High 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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Litian Pictures Holdings insiders own 44% of the company, currently worth about HK$19m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

What Might The Insider Transactions At Litian Pictures Holdings Tell Us?

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 Litian Pictures Holdings, we can't say the same about the selling of shares. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Litian Pictures Holdings. To assist with this, we've discovered 3 warning signs that you should run your eye over to get a better picture of Litian Pictures Holdings.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.