We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in SuperRobotics Limited (HKG:8176).

What Is Insider Selling?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, such insiders must disclose their trading activities, and not trade on inside information.

We don’t think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Colombia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.

See our latest analysis for SuperRobotics

SuperRobotics Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by Chairman Zhituan Su for HK$217m worth of shares, at about HK$6.90 per share. So we know that an insider sold shares at around the present share price of HK$5.80. They could have a variety of motivations for selling, but it’s still not particularly encouraging to see. We usually pause to reflect on the potential that a stock has a high valuation, if insiders have been selling at around the current price. Notably Zhituan Su was also the biggest buyer, having purchased HK$66m worth of shares.

Over the last year we saw more insider selling of SuperRobotics shares, than buying. They sold for an average price of about HK$6.95. We don’t gain much confidence from insider selling near the recent share price. Since insiders sell for many reasons, we wouldn’t put too much weight on it. The chart below shows insider transactions over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Insiders at SuperRobotics Have Sold Stock Recently

We’ve seen more insider selling than insider buying at SuperRobotics recently. We note Zhituan Su cashed in HK$217m worth of shares. On the flip side, Chairman Zhituan Su spent HK$66m on purchasing shares (as mentioned above). We don’t view these transactions as a positive sign.

Insider Ownership

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. SuperRobotics insiders own 33% of the company, currently worth about HK$999m based on the recent share price. 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 SuperRobotics Insiders?

Unfortunately, there has been more insider selling of SuperRobotics stock, than buying, in the last three months. Zooming out, the longer term picture doesn’t give us much comfort. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn’t make us feel confident about the company. I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow for free .

But note: SuperRobotics 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.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.