Insiders Could Have Profited By Holding onto Shanghai Turbo Enterprises Shares Despite 40% Drop

Despite the fact that Shanghai Turbo Enterprises Ltd's (SGX:AWM) value has dropped 40% in the last week insiders who sold CN¥2.3m worth of stock in the past 12 months have had less success. Given that the average selling price of CN¥1.00 is still lower than the current share price, insiders would probably have been better off keeping their shares.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for Shanghai Turbo Enterprises

Shanghai Turbo Enterprises Insider Transactions Over The Last Year

The insider, ChuanJun Lin, made the biggest insider sale in the last 12 months. That single transaction was for S$2.3m worth of shares at a price of S$1.00 each. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The silver lining is that this sell-down took place above the latest price (S$0.024). So it may not tell us anything about how insiders feel about the current share price. ChuanJun Lin was the only individual insider to sell shares in the last twelve months.

You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

I will like Shanghai Turbo Enterprises better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Insider Ownership Of Shanghai Turbo Enterprises

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. It appears that Shanghai Turbo Enterprises insiders own 32% of the company, worth about S$235k. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Do The Shanghai Turbo Enterprises Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Shanghai Turbo Enterprises shares in the last quarter. Our analysis of Shanghai Turbo Enterprises insider transactions leaves us cautious. But it's good to see that insiders own shares in 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. To assist with this, we've discovered 3 warning signs that you should run your eye over to get a better picture of Shanghai Turbo Enterprises.

Of course Shanghai Turbo Enterprises 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 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.