Insiders Could Have Profited By Holding onto Top Spring International Holdings Shares Despite 21% Drop

Top Spring International Holdings Limited's (HKG:3688) value has fallen 21% in the last week, but insiders who sold HK$93m worth of stock over the last year have had less success. Insiders might have been better off holding onto their shares, given that the average selling price of HK$1.10 is still below the current share price.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for Top Spring International Holdings

The Last 12 Months Of Insider Transactions At Top Spring International Holdings

The Founder, Chun Hong Wong, made the biggest insider sale in the last 12 months. That single transaction was for HK$93m worth of shares at a price of HK$1.10 each. 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$0.36. So it may not shed much light on insider confidence at current levels. Chun Hong Wong was the only individual insider to sell shares in the last twelve months.

The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

I will like Top Spring International 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.

Insider Ownership Of Top Spring International Holdings

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 30% of Top Spring International Holdings shares, worth about HK$164m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Top Spring International Holdings Insiders?

It doesn't really mean much that no insider has traded Top Spring International Holdings shares in the last quarter. While we feel good about high insider ownership of Top Spring International Holdings, we can't say the same about the selling of shares. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Every company has risks, and we've spotted 4 warning signs for Top Spring International Holdings (of which 2 can't be ignored!) you should know about.

But note: Top Spring International Holdings may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.

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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.

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