share_log

Onewo Insider Lowered Holding By 29% During Last Year

Simply Wall St ·  Jan 21 02:14

From what we can see, insiders were net sellers in Onewo Inc.'s (HKG:2602 ) during the past 12 months. That is, insiders sold the stock in greater numbers than they purchased it.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

The Last 12 Months Of Insider Transactions At Onewo

Over the last year, we can see that the biggest insider sale was by the GM & Executive Chairman, Baoquan Zhu, for HK$376m worth of shares, at about HK$18.24 per share. That means that even when the share price was below the current price of HK$20.55, 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. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 29% of Baoquan Zhu's holding. Baoquan Zhu was the only individual insider to sell shares in the last twelve months. Notably Baoquan Zhu was also the biggest buyer, having purchased HK$533m worth of shares.

In the last twelve months insiders purchased 55.97m shares for HK$533m. On the other hand they divested 40.63m shares, for HK$741m. Baoquan Zhu sold a total of 40.63m shares over the year at an average price of CN¥18.24. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

big
SEHK:2602 Insider Trading Volume January 21st 2025

For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.

Insiders At Onewo Have Sold Stock Recently

There was substantially more insider selling, than buying, of Onewo shares over the last three months. We note GM & Executive Chairman Baoquan Zhu cashed in HK$376m worth of shares. On the other hand we note Chief Mktg. Officer Shuhua He bought HK$18m worth of shares. Since the selling really does outweigh the buying, we'd say that these transactions may suggest that some insiders feel the company has been fully valued in recent months.

Insider Ownership Of Onewo

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. Onewo insiders own 4.4% of the company, currently worth about HK$1.0b based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Does This Data Suggest About Onewo Insiders?

The stark truth for Onewo is that there has been more insider selling than insider buying in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. On the plus side, Onewo makes money, and is growing profits. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Onewo. For example, Onewo has 2 warning signs (and 1 which can't be ignored) we think you should know about.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.

Disclaimer: This content is for informational and educational purposes only and does not constitute a recommendation or endorsement of any specific investment or investment strategy. Read more
Comment Comment · Views 336

Recommended

Write a comment