We'd be surprised if Yuexiu Property Company Limited (HKG:123) shareholders haven't noticed that the Independent Non-Executive Director, Ka Lun Lee, recently sold HK$2.2m worth of stock at HK$10.17 per share. That sale was 33% of their holding, so it does make us raise an eyebrow.

See our latest analysis for Yuexiu Property

The Last 12 Months Of Insider Transactions At Yuexiu Property

Over the last year, we can see that the biggest insider sale was by the Executive Vice Chairman & GM, Feng Lin, for HK$7.3m worth of shares, at about HK$8.89 per share. That means that an insider was selling shares at slightly below the current price (HK$10.64). When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 32% of Feng Lin's holding.

Happily, we note that in the last year insiders paid HK$15m for 1.93m shares. But they sold 1.74m shares for HK$17m. In total, Yuexiu Property insiders sold more than they bought over the last year. They sold for an average price of about CN¥9.50. It's not too encouraging to see that insiders have sold at below the current price. Since insiders sell for many reasons, we wouldn't put too much weight on it. 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!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).

Does Yuexiu Property Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Our data indicates that Yuexiu Property insiders own about HK$68m worth of shares (which is 0.2% of the company). However, it's possible that insiders might have an indirect interest through a more complex structure. Whilst better than nothing, we're not overly impressed by these holdings.

So What Do The Yuexiu Property Insider Transactions Indicate?

The stark truth for Yuexiu Property is that there has been more insider selling than insider buying in the last three months. Zooming out, the longer term picture doesn't give us much comfort. While insiders do own shares, they don't own a heap, and they have been selling. We'd practice some caution before buying! 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. Our analysis shows 4 warning signs for Yuexiu Property (1 is a bit unpleasant!) and we strongly recommend you look at them before investing.

But note: Yuexiu Property 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, 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.