Peijia Medical Limited's (HKG:9996) stock price has dropped 15% in the previous week, but insiders who sold CN¥11m 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¥10.71 is still below the current share price.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

Peijia Medical Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the Executive Director & Company Secretary, Hong Ye, for HK$3.1m worth of shares, at about HK$11.09 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The good news is that this large sale was at well above current price of HK$4.17. So it is hard to draw any strong conclusion from it. Hong Ye was the only individual insider to sell shares in the last twelve months.

Hong Ye divested 1.04m shares over the last 12 months at an average price of CN¥10.71. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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Insider Ownership Of Peijia Medical

For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 3.1% of Peijia Medical shares, worth about HK$86m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Peijia Medical Insider Transactions Indicate?

There haven't been any insider transactions in the last three months -- that doesn't mean much. Still, the insider transactions at Peijia Medical in the last 12 months are not very heartening. But it's good to see that insiders own shares in the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Peijia Medical. To assist with this, we've discovered 1 warning sign that you should run your eye over to get a better picture of Peijia Medical.

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.

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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.