Have Yincheng Life Service CO., Ltd. (HKG:1922) Insiders Been Selling Their Stock?

We wouldn't blame Yincheng Life Service CO., Ltd. (HKG:1922) shareholders if they were a little worried about the fact that Chengshu Dai, a company insider, recently netted about HK$12m selling shares at an average price of HK$5.00. However, that sale only accounted for 7.2% of their holding, so arguably it doesn't say much about their conviction.

See our latest analysis for Yincheng Life Service

The Last 12 Months Of Insider Transactions At Yincheng Life Service

In the last twelve months, the biggest single sale by an insider was when the Non-Executive Director, Qingping Huang, sold HK$59m worth of shares at a price of HK$6.30 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The silver lining is that this sell-down took place above the latest price (HK$5.01). So it may not shed much light on insider confidence at current levels.

Over the last year, we can see that insiders have bought 11.03m shares worth HK$62m. But insiders sold 11.85m shares worth HK$71m. All up, insiders sold more shares in Yincheng Life Service than they bought, over the last year. They sold for an average price of about CN¥6.03. We are not joyful about insider selling. But the selling was at much higher prices than the current share price (HK$5.01), so it probably doesn't tell us a lot about the value on offer today. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Insider Ownership of Yincheng Life Service

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Yincheng Life Service insiders own 75% of the company, currently worth about HK$976m based on the recent share price. 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 Does This Data Suggest About Yincheng Life Service Insiders?

It is good to see the recent insider purchase. On the other hand the transaction history, over the last year, isn't so positive. The recent buying by an insider , along with high insider ownership, suggest that Yincheng Life Service insiders are fairly aligned, and optimistic. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. At Simply Wall St, we found 2 warning signs for Yincheng Life Service that deserve your attention before buying any shares.

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, but not derivative transactions.

When trading Yincheng Life Service or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted

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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

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