Are Insiders Selling Genscript Biotech Corporation (HKG:1548) Stock?

We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So before you buy or sell Genscript Biotech Corporation (HKG:1548), you may well want to know whether insiders have been buying or selling.

Do Insider Transactions Matter?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, rules govern insider transactions, and certain disclosures are required.

We don't think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise'.

See our latest analysis for Genscript Biotech

The Last 12 Months Of Insider Transactions At Genscript Biotech

Over the last year, we can see that the biggest insider sale was by the Co-Founder, Ye Wang, for HK$212m worth of shares, at about HK$14.16 per share. So what is clear is that an insider saw fit to sell at around the current price of HK$12.24. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern. Ye Wang was the only individual insider to sell shares in the last twelve months.

Over the last year, we can see that insiders have bought 1.40m shares worth HK$17m. On the other hand they divested 15.00m shares, for HK$212m. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, 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 Genscript Biotech better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. Our data suggests Genscript Biotech insiders own 0.1% of the company, worth about HK$36m. However, it's possible that insiders might have an indirect interest through a more complex structure. We consider this fairly low insider ownership.

What Might The Insider Transactions At Genscript Biotech Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. Still, the insider transactions at Genscript Biotech in the last 12 months are not very heartening. But it's good to see that insiders own shares in 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. Case in point: We've spotted 1 warning sign for Genscript Biotech you should be aware of.

Of course Genscript Biotech may not be the best stock to buy. So you may wish to see this free collection of high quality 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, but not derivative transactions.

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This article by Simply Wall St is general in nature. 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.
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