Some 3SBio Inc. (HKG:1530) shareholders may be a little concerned to see that the Non-Executive Director, Jiaoe Zhang, recently sold a substantial HK$5.7m worth of stock at a price of HK$12.42 per share. However, that sale only accounted for 3.6% of their holding, so arguably it doesn't say much about their conviction.
The Last 12 Months Of Insider Transactions At 3SBio
In fact, the recent sale by Jiaoe Zhang was the biggest sale of 3SBio shares made by an insider individual in the last twelve months, according to our records. That means that an insider was selling shares at around the current price of HK$11.96. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.
Jiaoe Zhang sold a total of 486.00k shares over the year at an average price of CN¥12.45. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
View our latest analysis for 3SBio
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Does 3SBio Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. 3SBio insiders own about HK$2.1b worth of shares (which is 7.5% of the company). Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Do The 3SBio Insider Transactions Indicate?
An insider sold stock recently, but they haven't been buying. Zooming out, the longer term picture doesn't give us much comfort. But since 3SBio is profitable and growing, we're not too worried by this. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. While conducting our analysis, we found that 3SBio has 1 warning sign and it would be unwise to ignore this.
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.