It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in Geely Automobile Holdings Limited's (HKG:175) case, it's fantastic news for shareholders.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Geely Automobile Holdings

The Last 12 Months Of Insider Transactions At Geely Automobile Holdings

In the last twelve months, the biggest single purchase by an insider was when CEO & Executive Director Sheng Yue Gui bought HK$3.6m worth of shares at a price of HK$12.10 per share. Even though the purchase was made at a significantly lower price than the recent price (HK$17.38), we still think insider buying is a positive. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.

Geely Automobile Holdings insiders may have bought shares in the last year, but they didn't sell any. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Does Geely Automobile Holdings Boast High 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. We usually like to see fairly high levels of insider ownership. Geely Automobile Holdings insiders own about HK$4.6b worth of shares (which is 2.6% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Do The Geely Automobile Holdings Insider Transactions Indicate?

The fact that there have been no Geely Automobile Holdings insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. With high insider ownership and encouraging transactions, it seems like Geely Automobile Holdings insiders think the business has merit. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Geely Automobile Holdings. In terms of investment risks, we've identified 2 warning signs with Geely Automobile Holdings and understanding them should be part of your investment process.

Of course Geely Automobile Holdings may not be the best stock to buy. So you may wish to see this free collection of high quality 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.