Some Xin Yuan Enterprises Group Limited (HKG:1748) shareholders may be a little concerned to see that insider Shaoyun Lan recently sold a substantial HK$158m worth of stock at a price of HK$4.85 per share.    That diminished their holding by a very significant 52%, which arguably implies a strong desire to reallocate capital.    

Check out our latest analysis for Xin Yuan Enterprises Group

Xin Yuan Enterprises Group Insider Transactions Over The Last Year

Notably, that recent sale by Shaoyun Lan is the biggest insider sale of Xin Yuan Enterprises Group shares that we've seen in the last year.     That means that even when the share price was  slightly  below the current price of HK$4.85, an insider wanted to cash in some shares.  We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable.  While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign.   We note that the biggest single sale was 52% of Shaoyun Lan's holding.    

Over the last year we saw more insider selling of Xin Yuan Enterprises Group shares, than buying.    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!

SEHK:1748 Insider Trading Volume January 30th 2024

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).

Insider Ownership Of Xin Yuan Enterprises 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.  Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term.   Xin Yuan Enterprises Group insiders own about HK$1.6b worth of shares (which is 73% of the company).  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 Do The Xin Yuan Enterprises Group Insider Transactions Indicate?

Insiders  sold Xin Yuan Enterprises Group shares recently, but they didn't buy any.     And our longer term analysis of insider transactions didn't bring confidence, either.    On the plus side, Xin Yuan Enterprises Group makes money, and is growing profits.    It is good to see high insider ownership, but the insider selling leaves us cautious.      In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Xin Yuan Enterprises Group.    To that end, you should learn about the 2 warning signs we've spotted with Xin Yuan Enterprises Group (including 1 which can't be ignored).

Of course Xin Yuan Enterprises 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.