Even though SANVO Fine Chemicals Group Limited (HKG:301) stock gained 27% last week, insiders who sold CN¥20m worth of stock over the past year are probably better off. Selling at an average price of CN¥1.12, which is higher than the current price might have been the right call as holding on to stock would have meant their investment would be worth less now than it was at the time of sale.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.
The Last 12 Months Of Insider Transactions At SANVO Fine Chemicals Group
In the last twelve months, the biggest single sale by an insider was when the Chairman & CEO, Bingqiang Chen, sold HK$15m worth of shares at a price of HK$1.12 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The silver lining is that this sell-down took place above the latest price (HK$0.99). So it is hard to draw any strong conclusion from it. Bingqiang Chen was the only individual insider to sell shares in the last twelve months. Notably Bingqiang Chen was also the biggest buyer, having purchased HK$5.0m worth of shares.
Bingqiang Chen divested 17.49m shares over the last 12 months at an average price of CN¥1.12. 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!
Check out our latest analysis for SANVO Fine Chemicals Group
For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.
Insider Ownership Of SANVO Fine Chemicals Group
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. SANVO Fine Chemicals Group insiders own 69% of the company, currently worth about HK$320m 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.
What Might The Insider Transactions At SANVO Fine Chemicals Group Tell Us?
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 SANVO Fine Chemicals Group, 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. Our analysis shows 4 warning signs for SANVO Fine Chemicals Group (1 shouldn't be ignored!) and we strongly recommend you look at these before investing.
But note: SANVO Fine Chemicals 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.