Looking at Flowing Cloud Technology Ltd's (HKG:6610 ) insider transactions over the last year, we can see that insiders were net sellers. That is, there were more number of shares sold by insiders than there were purchased.
While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Check out our latest analysis for Flowing Cloud Technology
The Last 12 Months Of Insider Transactions At Flowing Cloud Technology
Notably, that recent sale by Yanhao Li is the biggest insider sale of Flowing Cloud Technology shares that we've seen in the last year. That means that an insider was selling shares at slightly below the current price (HK$0.30). 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. We note that the biggest single sale was only 10% of Yanhao Li's holding.
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!
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.
Flowing Cloud Technology Insiders Are Selling The Stock
The last quarter saw substantial insider selling of Flowing Cloud Technology shares. In total, Senior VP & CTO Yanhao Li dumped HK$2.7m worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.
Insider Ownership Of Flowing Cloud Technology
For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Our data isn't picking up on much insider ownership at Flowing Cloud Technology, though insiders do hold about HK$90k worth of shares. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. We might be missing something but that seems like very low insider ownership.
So What Does This Data Suggest About Flowing Cloud Technology Insiders?
An insider hasn't bought Flowing Cloud Technology stock in the last three months, but there was some selling. And there weren't any purchases to give us comfort, over the last year. When you combine this with the relatively low insider ownership, we are very cautious about the stock. So we'd only buy after very careful consideration. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Our analysis shows 4 warning signs for Flowing Cloud Technology (1 can't be ignored!) and we strongly recommend you look at these before investing.
Of course Flowing Cloud Technology 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.