Those following along with Silk Road Energy Services Group Limited (HKG:8250) will no doubt be intrigued by the recent purchase of shares by insider Gongming Xu, who spent a stonking HK$6.7m on stock at an average price of HK$0.014. Not only is that a big swing, but it increased their holding size by 30%, which is definitely great to see.

Check out our latest analysis for Silk Road Energy Services Group

The Last 12 Months Of Insider Transactions At Silk Road Energy Services Group

In fact, the recent purchase by insider Gongming Xu was not their only acquisition of Silk Road Energy Services Group shares this year. They previously made an even bigger purchase of HK$6.8m worth of shares at a price of HK$0.02 per share. That means that even when the share price was higher than HK$0.015 (the recent price), an insider wanted to purchase shares. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. To us, it's very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Gongming Xu was the only individual insider to buy during the last year.

Gongming Xu bought a total of 929.66m shares over the year at an average price of HK$0.017. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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).

Insider Ownership Of Silk Road Energy Services Group

For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It appears that Silk Road Energy Services Group insiders own 29% of the company, worth about HK$33m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Does This Data Suggest About Silk Road Energy Services Group Insiders?

It is good to see the recent insider purchase. And the longer term insider transactions also give us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Insiders likely see value in Silk Road Energy Services Group shares, given these transactions (along with notable insider ownership of the company). So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Be aware that Silk Road Energy Services Group is showing 2 warning signs in our investment analysis, and 1 of those is concerning...

But note: Silk Road Energy Services Group 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.

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. 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.