We wouldn't blame Microvast Holdings, Inc. (NASDAQ:MVST) shareholders if they were a little worried about the fact that Yanzhuan Zheng, the Director recently netted about US$1.3m selling shares at an average price of US$1.30. That diminished their holding by a very significant 60%, which arguably implies a strong desire to reallocate capital.

Check out our latest analysis for Microvast Holdings

Microvast Holdings Insider Transactions Over The Last Year

In fact, the recent sale by Yanzhuan Zheng was the biggest sale of Microvast Holdings shares made by an insider individual in the last twelve months, according to our records. That means that an insider was selling shares at slightly below the current price (US$1.34). As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. It is worth noting that this sale was 60% of Yanzhuan Zheng's holding.

Yanzhuan Zheng divested 1.31m shares over the last 12 months at an average price of US$1.47. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Insider Ownership Of Microvast Holdings

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Microvast Holdings insiders own about US$123m worth of shares (which is 29% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At Microvast Holdings Tell Us?

The stark truth for Microvast Holdings is that there has been more insider selling than insider buying in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. 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. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. When we did our research, we found 4 warning signs for Microvast Holdings (1 is significant!) that we believe deserve your full attention.

Of course Microvast 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 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.