Have Insiders Been Buying China Evergrande New Energy Vehicle Group Limited (HKG:708) Shares?

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 before you buy or sell China Evergrande New Energy Vehicle Group Limited (HKG:708), you may well want to know whether insiders have been buying or selling.

What Is Insider Selling?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.

Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia 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'.

View our latest analysis for China Evergrande New Energy Vehicle Group

China Evergrande New Energy Vehicle Group Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Executive Vice Chairman of the Board Yongzhuo Liu bought HK$16m worth of shares at a price of HK$18.94 per share. We do like to see buying, but this purchase was made at well below the current price of HK$30.00. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

China Evergrande New Energy Vehicle Group insiders may have bought shares in the last year, but they didn't sell any. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

China Evergrande New Energy Vehicle Group is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

China Evergrande New Energy Vehicle Group Insiders Bought Stock Recently

Over the last three months, we've seen significant insider buying at China Evergrande New Energy Vehicle Group. We can see that Executive Director Liyong Qin paid HK$8.3m for shares in the company. No-one sold. This could be interpreted as suggesting a positive outlook.

Does China Evergrande New Energy Vehicle Group Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. Insiders own 0.02% of China Evergrande New Energy Vehicle Group shares, worth about HK$41m, according to our data. We do generally prefer see higher levels of insider ownership.

What Might The Insider Transactions At China Evergrande New Energy Vehicle Group Tell Us?

It is good to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Insiders likely see value in China Evergrande New Energy Vehicle Group shares, given these transactions (along with notable insider ownership of the company). So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Every company has risks, and we've spotted 4 warning signs for China Evergrande New Energy Vehicle Group (of which 2 make us uncomfortable!) you should know about.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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, but not derivative transactions.

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This article by Simply Wall St is general in nature. 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.
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