Possible Signal As Magic Empire Global Insiders Sell HK$1.1m In Stock

Even though Magic Empire Global Limited (NASDAQ:MEGL) stock gained 12% last week, insiders who sold HK$1.1m worth of stock over the past year are probably better off. Selling at an average price of HK$0.88, which is higher than the current price, may have been the wisest decision for these insiders as their investment would have been worth less now than when they sold.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for Magic Empire Global

The Last 12 Months Of Insider Transactions At Magic Empire Global

The Chairman of the Board, Wai Chan, made the biggest insider sale in the last 12 months. That single transaction was for US$347k worth of shares at a price of US$1.20 each. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. It's of some comfort that this sale was conducted at a price well above the current share price, which is US$0.54. So it is hard to draw any strong conclusion from it.

In the last year Magic Empire Global insiders didn't buy any company stock. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.

Does Magic Empire Global Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Magic Empire Global insiders own 52% of the company, currently worth about US$5.0m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Do The Magic Empire Global Insider Transactions Indicate?

The fact that there have been no Magic Empire Global insider transactions recently certainly doesn't bother us. While we feel good about high insider ownership of Magic Empire Global, we can't say the same about the selling of shares. While it's good to be aware of 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. At Simply Wall St, we've found that Magic Empire Global has 4 warning signs (2 make us uncomfortable!) that deserve your attention before going any further with your analysis.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.