Last week, $XD Inc.(02400.HK)$ stock jumped 8.6%, but insiders who sold CN¥73m worth of stock in over the past year are likely to be in a better position.  Selling at an average price of CN¥25.09, which is higher than the current price, may have been the wisest decision for these insiders as their investment would have been worth less now than when they sold.

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.

View our latest analysis for XD

The Last 12 Months Of Insider Transactions At XD

In the last twelve months, the biggest single sale by an insider was when the Founder, Yimeng Huang, sold HK$53m worth of shares at a price of HK$25.18 per share.   While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price.  It's of some comfort that this sale was conducted at a price well above the current share price, which is HK$20.00.  So it may not shed much light on insider confidence at current levels.    Notably Yimeng Huang was also the biggest buyer, having purchased HK$31m worth of shares.

Over the last year we saw more insider selling of XD shares, than buying.    The chart below shows insider transactions (by companies and individuals) over the last year.  By clicking on the graph below, you can see the precise details of each insider transaction!

SEHK:2400 Insider Trading Volume July 22nd 2022

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership

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.   It's great to see that XD insiders own 49% of the company, worth about HK$4.6b.  I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Does This Data Suggest About XD Insiders?

The fact that there have been no XD insider transactions recently certainly doesn't bother us.      It's heartening that insiders own plenty of stock, but we'd like to see more insider buying, since the last year of XD insider transactions don't fill us with confidence.       So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing.    Case in point: We've spotted 1 warning sign for XD 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, but not derivative transactions.

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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.