Insiders who acquired CN¥155.1m worth of China Strategic Technology Group Limited’s (HKG:1725) stock at an average price of CN¥0.59 in the past 12 months may be dismayed by the recent 14% price decline. Insiders buy with the expectation to see their investments rise in value over a period of time. However, recent losses have rendered their above investment worth CN¥70.5m which is not ideal.
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.
China Strategic Technology Group Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when insider Yue Ren bought HK$65m worth of shares at a price of HK$0.65 per share. That means that an insider was happy to buy shares at above the current price of HK$0.27. It’s very possible they regret the purchase, but it’s more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
Happily, we note that in the last year insiders paid HK$155m for 260.93m shares. But insiders sold 100.93m shares worth HK$57m. Overall, China Strategic Technology Group insiders were net buyers during the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
See our latest analysis for China Strategic Technology Group
There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insiders At China Strategic Technology Group Have Sold Stock Recently
The last three months saw significant insider selling at China Strategic Technology Group. Specifically, insider Chang Lun Xie ditched HK$11m worth of shares in that time, and we didn’t record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.
Insider Ownership
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Insiders own 28% of China Strategic Technology Group shares, worth about HK$63m. We’ve certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Does This Data Suggest About China Strategic Technology Group Insiders?
An insider hasn’t bought China Strategic Technology Group stock in the last three months, but there was some selling. On the other hand, the insider transactions over the last year are encouraging. We like that insiders own a fair amount of the company. So we’re happy enough to look past some selling. 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. For instance, we’ve identified 5 warning signs for China Strategic Technology Group (3 make us uncomfortable) you should be aware of.
If you would prefer to check out another company — one with potentially superior financials — then do not miss this free list of interesting companies, that have HIGH return on equity 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.
New: AI Stock Screener & Alerts
Our new AI Stock Screener scans the market every day to uncover opportunities.
• Dividend Powerhouses (3%+ Yield)
• Undervalued Small Caps with Insider Buying
• High growth Tech and AI Companies
Or build your own from over 50 metrics.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
