15% Of This PCCW Insider's Holdings Were Sold
Looking at PCCW Limited's (HKG:8 ) insider transactions over the last year, we can see that insiders were net sellers. That is, there were more number of shares sold by insiders than there were purchased.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.
The Last 12 Months Of Insider Transactions At PCCW
The Acting Group MD, Hon-Hing Hui, made the biggest insider sale in the last 12 months. That single transaction was for HK$7.2m worth of shares at a price of HK$5.00 each. That means that an insider was selling shares at slightly below the current price (HK$5.83). 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. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was just 15% of Hon-Hing Hui's stake. Hon-Hing Hui was the only individual insider to sell shares in the last twelve months.
Hon-Hing Hui ditched 2.22m shares over the year. The average price per share was HK$5.10. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
See our latest analysis for PCCW
If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.
Insider Ownership Of PCCW
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. PCCW insiders own about HK$3.2b worth of shares (which is 7.0% of the company). 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 PCCW Insiders?
The fact that there have been no PCCW insider transactions recently certainly doesn't bother us. While we feel good about high insider ownership of PCCW, we can't say the same about the selling of shares. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing PCCW. Every company has risks, and we've spotted 2 warning signs for PCCW (of which 1 can't be ignored!) you should know about.
But note: PCCW may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.