Have New City Development Group Insiders Been Selling Stock?

Anyone interested in New City Development Group Limited (HKG:456) should probably be aware that the Executive Chairman & CEO, Junran Han, recently divested HK$3.6m worth of shares in the company, at an average price of HK$0.60 each. However, the silver lining is that the sale only reduced their total holding by 7.9%, so we're hesitant to read anything much into it, on its own.

See our latest analysis for New City Development Group

New City Development Group Insider Transactions Over The Last Year

Notably, that recent sale by Executive Chairman & CEO Junran Han was not the only time they traded New City Development Group shares this year. They previously purchased HK$18m worth of shares at a price of HK$0.57 per share. That means that an insider was happy to buy shares at around the current price of HK$0.60. Of course they may have changed their mind. But this suggests they are optimistic. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. The good news for New City Development Group share holders is that an insider was buying at near the current price. Junran Han was the only individual insider to buy shares in the last twelve months.

Over the last year we saw more insider selling of New City Development Group shares, than buying. 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!

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).

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. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that New City Development Group insiders own 64% of the company, worth about HK$45m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The New City Development Group Insider Transactions Indicate?

An insider sold New City Development Group shares recently, but they didn't buy any. Zooming out, the longer term picture doesn't give us much comfort. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. While we like knowing 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. To that end, you should learn about the 6 warning signs we've spotted with New City Development Group (including 2 which are potentially serious).

Of course New City Development Group 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 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.