Those following along with Consun Pharmaceutical Group Limited (HKG:1681) will no doubt be intrigued by the recent purchase of shares by Meng An, CEO & Executive Chairman of the company, who spent a stonking HK$5.4m on stock at an average price of HK$5.64. There's no denying a buy of that magnitude suggests conviction in a brighter future, although we do note that proportionally it only increased their holding by 5.8%.
The Last 12 Months Of Insider Transactions At Consun Pharmaceutical Group
The insider, Yubao An, made the biggest insider sale in the last 12 months. That single transaction was for HK$62m worth of shares at a price of HK$6.70 each. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The good news is that this large sale was at well above current price of HK$5.67. So it is hard to draw any strong conclusion from it.
Happily, we note that in the last year insiders paid HK$22m for 4.14m shares. But insiders sold 10.51m shares worth HK$70m. All up, insiders sold more shares in Consun Pharmaceutical Group than they bought, over the last year. The sellers received a price of around CN¥6.68, on average. We are not joyful about insider selling. But the selling was at much higher prices than the current share price (HK$5.67), so it probably doesn't tell us a lot about the value on offer today. The chart below shows insider transactions (by companies and individuals) over the last year. 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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Does Consun Pharmaceutical Group Boast High 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. I reckon it's a good sign if insiders own a significant number of shares in the company. Consun Pharmaceutical Group insiders own 45% of the company, currently worth about HK$2.1b based on the recent share price. 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 Consun Pharmaceutical Group Insiders?
The recent insider purchases are heartening. On the other hand the transaction history, over the last year, isn't so positive. The recent buying by some insiders , along with high insider ownership, suggest that Consun Pharmaceutical Group insiders are fairly aligned, and optimistic. 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 2 warning signs for Consun Pharmaceutical Group you should be aware of.
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 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.
