Insider Sellers Might Regret Selling China Frontier Technology Group Shares at a Lower Price Than Current Market Value

China Frontier Technology Group's (HKG:1661) stock price has dropped 14% in the previous week, but insiders who sold CN¥100m in stock over the past year have had less luck. Given that the average selling price of CN¥0.25 is still lower than the current share price, insiders would probably have been better off keeping their shares.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

See our latest analysis for China Frontier Technology Group

The Last 12 Months Of Insider Transactions At China Frontier Technology Group

The Co-Chairlady, Guozun Ren , made the biggest insider sale in the last 12 months. That single transaction was for HK$100m worth of shares at a price of HK$0.25 each. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is HK$0.12. So it may not shed much light on insider confidence at current levels. Guozun Ren was the only individual insider to sell over the last year.

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!

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

Insider Ownership Of China Frontier Technology Group

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. It's great to see that China Frontier Technology Group insiders own 48% of the company, worth about HK$112m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

What Might The Insider Transactions At China Frontier Technology Group Tell Us?

It doesn't really mean much that no insider has traded China Frontier Technology Group shares in the last quarter. It's heartening that insiders own plenty of stock, but we'd like to see more insider buying, since the last year of China Frontier Technology Group insider transactions don't fill us with confidence. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing China Frontier Technology Group. While conducting our analysis, we found that China Frontier Technology Group has 3 warning signs and it would be unwise to ignore these.

Of course China Frontier Technology Group may not be the best stock to buy. So you may wish to see this free collection of high quality 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.