Pop Mart International Group Insiders Sell CN¥940m Of Stock, Possibly Signalling Caution

Many Pop Mart International Group Limited (HKG:9992) insiders ditched their stock over the past year, which may be of interest to the company's shareholders. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, if numerous insiders are selling, shareholders should investigate more.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for Pop Mart International Group

The Last 12 Months Of Insider Transactions At Pop Mart International Group

In the last twelve months, the biggest single sale by an insider was when the Executive Chairman & CEO, Ning Wang, sold HK$781m worth of shares at a price of HK$71.98 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of HK$87.60. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. We note that the biggest single sale was only 1.9% of Ning Wang's holding.

Insiders in Pop Mart International Group didn't buy any shares in 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!

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Insiders At Pop Mart International Group Have Sold Stock Recently

Over the last three months, we've seen significant insider selling at Pop Mart International Group. In total, insiders dumped HK$940m worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Does Pop Mart International Group Boast High Insider Ownership?

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. Pop Mart International Group insiders own about HK$49b worth of shares (which is 42% of the company). 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 Pop Mart International Group Tell Us?

Insiders haven't bought Pop Mart International Group stock in the last three months, but there was some selling. And there weren't any purchases to give us comfort, over the last year. But it is good to see that Pop Mart International Group is growing earnings. It is good to see high insider ownership, but the insider selling leaves us cautious. 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. You'd be interested to know, that we found 1 warning sign for Pop Mart International Group and we suggest you have a look.

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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.