Despite a 13% gain in Pan Asia Environmental Protection Group Limited's (HKG:556) stock price this week, shareholders shouldn't let up. The fact that insiders chose to dispose of CN¥58m worth of stock in the past 12 months even though prices were relatively low could be indicative of some anticipated weakness.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
Check out our latest analysis for Pan Asia Environmental Protection Group
Pan Asia Environmental Protection Group Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider sale was by the insider, Guanfei Liang, for HK$22m worth of shares, at about HK$0.73 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The good news is that this large sale was at well above current price of HK$0.55. So it may not tell us anything about how insiders feel about the current share price.
All up, insiders sold more shares in Pan Asia Environmental Protection Group than they bought, over the last year. 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 like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).
Insider Ownership
Many investors like to check how much of a company is owned by 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. Insiders own 28% of Pan Asia Environmental Protection Group shares, worth about HK$152m. 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 Pan Asia Environmental Protection Group Insiders?
It doesn't really mean much that no insider has traded Pan Asia Environmental Protection Group shares in the last quarter. While we feel good about high insider ownership of Pan Asia Environmental Protection Group, we can't say the same about the selling of shares. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. In terms of investment risks, we've identified 3 warning signs with Pan Asia Environmental Protection Group and understanding them should be part of your investment process.
But note: Pan Asia Environmental Protection Group 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.