While FriendTimes Inc. (HKG:6820) shareholders have enjoyed a good week with stock up 11%, they need remain vigilant. Even though stock prices were relatively low, insiders elected to sell CN¥143m worth of stock in the last year, which could indicate some expected downturn.
Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.
View our latest analysis for FriendTimes
The Last 12 Months Of Insider Transactions At FriendTimes
In the last twelve months, the biggest single sale by an insider was when the Founder, Xiaohuang Jiang, sold HK$72m worth of shares at a price of HK$0.75 per share. That means that an insider was selling shares at slightly below the current price (HK$0.84). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was just 7.3% of Xiaohuang Jiang's stake. Xiaohuang Jiang was the only individual insider to sell over the last year. Notably Xiaohuang Jiang was also the biggest buyer, having purchased HK$26m worth of shares.
Xiaohuang Jiang divested 190.00m shares over the last 12 months at an average price of CN¥0.75. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
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 FriendTimes Boast High Insider Ownership?
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. It's great to see that FriendTimes insiders own 62% of the company, worth about HK$1.1b. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Does This Data Suggest About FriendTimes Insiders?
There haven't been any insider transactions in the last three months -- that doesn't mean much. While we feel good about high insider ownership of FriendTimes, we can't say the same about the selling of shares. Therefore, you should definitely take a look at this FREE report showing analyst forecasts for FriendTimes.
But note: FriendTimes 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com