Yincheng International Holding Co., Ltd.'s (HKG:1902) stock price has dropped 9.4% in the previous week, but insiders who sold CN¥37m in stock over the past year have had less luck. Insiders might have been better off holding onto their shares, given that the average selling price of CN¥2.45 is still below the current share price.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

See our latest analysis for Yincheng International Holding

The Last 12 Months Of Insider Transactions At Yincheng International Holding

The insider, Chengshu Dai, made the biggest insider sale in the last 12 months. That single transaction was for HK$37m worth of shares at a price of HK$2.45 each. That means that even when the share price was below the current price of HK$2.70, an insider wanted to cash in some shares. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. We note that the biggest single sale was only 8.0% of Chengshu Dai's holding. Chengshu Dai was the only individual insider to sell shares in the last twelve months.

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!

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Insider Ownership Of Yincheng International Holding

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. Yincheng International Holding insiders own about HK$2.9b worth of shares (which is 73% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Yincheng International Holding Insiders?

The fact that there have been no Yincheng International Holding insider transactions recently certainly doesn't bother us. While we feel good about high insider ownership of Yincheng International Holding, we can't say the same about the selling of shares. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Yincheng International Holding. To help with this, we've discovered 3 warning signs (1 is potentially serious!) that you ought to be aware of before buying any shares in Yincheng International Holding.

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, 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.