Stock Analysis

13% Of This BOE Varitronix Insider's Holdings Were Sold

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Viewing insider transactions for BOE Varitronix Limited's (HKG:710 ) over the last year, we see that insiders were net sellers. This means that a larger number of shares were sold by insiders in relation to shares purchased.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

View our latest analysis for BOE Varitronix

BOE Varitronix Insider Transactions Over The Last Year

The insider, Chun-Shun Ko, made the biggest insider sale in the last 12 months. That single transaction was for HK$30m worth of shares at a price of HK$6.00 each. That means that even when the share price was below the current price of HK$7.60, 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. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was just 13% of Chun-Shun Ko's stake. The only individual insider seller over the last year was Chun-Shun Ko.

The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

SEHK:710 Insider Trading Volume December 3rd 2023

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Insiders At BOE Varitronix Have Sold Stock Recently

The last three months saw significant insider selling at BOE Varitronix. In total, insider Chun-Shun Ko dumped HK$30m 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.

Insider Ownership Of BOE Varitronix

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 4.8% of BOE Varitronix shares, worth about HK$288m. 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 BOE Varitronix Insiders?

An insider sold BOE Varitronix shares recently, but they didn't buy any. Zooming out, the longer term picture doesn't give us much comfort. But since BOE Varitronix is profitable and growing, we're not too worried by this. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. 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. Case in point: We've spotted 2 warning signs for BOE Varitronix you should be aware of, and 1 of them is a bit unpleasant.

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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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