Lajin Entertainment Network Group Limited (HKG:8172) market capitalization drops to HK$412 million, but insiders who sold HK$63 million shares were able to cover their losses

By selling 63 million Hong Kong dollars of Lajin Entertainment Network Group Limited (HKG:8172) at an average selling price of HK$0.32 over the past year, pundits seemed to have made the most of their holdings. After the share price fell 20% last week, the company’s market value fell by HK$105 million, but experts were able to mitigate their losses.

While we would never suggest that investors should base their decisions solely on what a company’s directors have been doing, we would consider it foolish to ignore internal transactions altogether.

See our latest review of Lajin Entertainment Network Group

Internal transactions of Lajin Entertainment Network Group during the past year

In the past twelve months, the largest single sale by a whistleblower was when the whistleblower, Nan Yu, sold HK$63 million worth of shares at a price of HK$0.32 per share. While we generally don’t like to see inside sales, it’s more of a concern if sales are made at a lower price. The good news is that this big sell-off was well above the current price of HK$0.098. Therefore, it is difficult to draw a solid conclusion from it. Nan Yu was the only insider to sell shares in the last twelve months.

You can see the internal transactions (by companies and individuals) during the last year shown in the graph below. By clicking on the chart below, you can see the precise details of each internal transaction!

SEHK:8172 Insider Trading Volume Oct 7, 2022

I will like Lajin Entertainment Network Group more if I see big internal purchases. While we wait, take a look at this free list of growing companies with significant and recent internal purchases.

Does Lajin Entertainment Network Group have high internal ownership?

Looking at the total insider holdings in a company can help inform your view of whether they are well aligned with common shareholders. I think it’s a good sign if the insiders own a significant amount of stock in the company. Our data indicates that members of the Lajin Entertainment Network Group own shares worth approximately HK$48 million (representing 12% of the company). However, it is possible that insiders may have an indirect interest through a more complex structure. While it’s better than nothing, we’re not overly impressed with these holdings.

So what does this data suggest about the members of the Lajin Entertainment Network Group?

There have been no internal transactions in the last three months, that doesn’t mean much. Our analysis of the internal transactions of Lajin Entertainment Network Group leaves us cautious. But it’s nice to see that insiders own shares in the company. So these insider trading can help us build a thesis on the stock, but it’s also worth learning about the risks this company faces. For example, we have identified 3 warning signs for Lajin Entertainment Network Group (1 makes us feel a bit uncomfortable) you must take into account.

of course Lajin Entertainment Network Group may not be the best stock to buy. So you might want to see this free collection of high-quality companies.

For the purposes of this article, insiders are those individuals who report their operations to the corresponding regulatory body. We currently account for open market transactions and private disposals, but not derivative transactions.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell any stock, and it does not take into account your goals or financial situation. Our goal is to provide you with long-term focused analysis driven by fundamental data. Please note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative material. Simply Wall St has no position in any of the stocks mentioned.

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find out if Lajin Entertainment Network Group is potentially overvalued or undervalued by consulting our comprehensive analysis, which includes fair value estimates, risks and caveats, dividends, internal transactions and financial health.

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