Reversal Of Fortune For Phoenix Motor Insiders Who Made A US$12.2m Purchase

Insiders who bought US$12.2m worth of Phoenix Motor Inc. (NASDAQ:PEV) stock in the last year recovered part of their losses as the stock rose by 13% last week. However, total losses seen by insiders are still US$6.0m since the time of purchase.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for Phoenix Motor

The Last 12 Months Of Insider Transactions At Phoenix Motor

In the last twelve months, the biggest single purchase by an insider was when Chairman of Board Xiaofeng Peng bought US$12m worth of shares at a price of US$1.02 per share. That means that an insider was happy to buy shares at above the current price of US$0.52. Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. Xiaofeng Peng was the only individual insider to buy shares in the last twelve months.

You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

Phoenix Motor is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 35% of Phoenix Motor shares, worth about US$6.0m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At Phoenix Motor Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. However, our analysis of transactions over the last year is heartening. Insiders do have a stake in Phoenix Motor and their transactions don't cause us concern. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Phoenix Motor. Every company has risks, and we've spotted 6 warning signs for Phoenix Motor (of which 4 make us uncomfortable!) you should know about.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.