MTT Group Holdings Executive Chairman of the Board & CEO Ka Wai Ip Sells 100% Of Holding

We wouldn't blame MTT Group Holdings Limited (HKG:2350) shareholders if they were a little worried about the fact that Ka Wai Ip, the Executive Chairman of the Board & CEO recently netted about HK$92m selling shares at an average price of HK$0.26. Probably the most concerning element of the whole transaction is that the disposal amounted to 100% of their entire holding.

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The Last 12 Months Of Insider Transactions At MTT Group Holdings

In fact, the recent sale by Ka Wai Ip was the biggest sale of MTT Group Holdings shares made by an insider individual in the last twelve months, according to our records. That means that even when the share price was below the current price of HK$0.36, an insider wanted to cash in some shares. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. 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. This single sale was 100% of Ka Wai Ip's stake.

Ka Wai Ip divested 418.75m shares over the last 12 months at an average price of HK$0.30. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

See our latest analysis for MTT Group Holdings

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Does MTT Group Holdings Boast High Insider Ownership?

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. MTT Group Holdings insiders own 62% of the company, currently worth about HK$140m based on the recent share price. 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 MTT Group Holdings Tell Us?

An insider sold stock recently, but they haven't been buying. Looking to the last twelve months, our data doesn't show any insider buying. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing MTT Group Holdings. Be aware that MTT Group Holdings is showing 3 warning signs in our investment analysis, and 1 of those makes us a bit uncomfortable...

But note: MTT Group 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.