Have Beijing Enterprises Water Group Limited (HKG:371) Insiders Been Selling Their Stock?

We note that the Beijing Enterprises Water Group Limited (HKG:371) COO & Executive Director, Li Li, recently sold HK$325k worth of stock for HK$3.07 per share. On the bright side, that's just a small sale and only reduced their holding by 8.5%.

See our latest analysis for Beijing Enterprises Water Group

The Last 12 Months Of Insider Transactions At Beijing Enterprises Water Group

Notably, that recent sale by Li Li is the biggest insider sale of Beijing Enterprises Water Group shares that we've seen in the last year. That means that an insider was selling shares at below the current price (HK$3.11). 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 just 8.5% of Li Li's stake.

Beijing Enterprises Water Group insiders didn't buy any shares over the last year. 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!

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

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Beijing Enterprises Water Group insiders own 3.3% of the company, currently worth about HK$1.0b 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.

So What Do The Beijing Enterprises Water Group Insider Transactions Indicate?

Insiders haven't bought Beijing Enterprises Water Group stock in the last three months, but there was some selling. 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. 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. For example, Beijing Enterprises Water Group has 3 warning signs (and 1 which is a bit concerning) we think you should know about.

Of course Beijing Enterprises Water 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, but not derivative transactions.

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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.
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