CFO & Executive Director Tie Li Sold A Bunch Of Shares In Li Auto

Some Li Auto Inc. (NASDAQ:LI) shareholders may be a little concerned to see that the CFO & Executive Director, Tie Li, recently sold a substantial US$822k worth of stock at a price of US$8.12 per share. That diminished their holding by a very significant 100%, which arguably implies a strong desire to reallocate capital.

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Li Auto Insider Transactions Over The Last Year

In fact, the recent sale by Tie Li was the biggest sale of Li Auto shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to take some cash off the table, even below the current price of US$16.78. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent 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. This single sale was 100% of Tie Li's stake.

In the last year Li Auto insiders didn't buy any company stock. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

View our latest analysis for Li Auto

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Insider Ownership Of Li Auto

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. Li Auto insiders own 33% of the company, currently worth about US$5.6b based on the recent share price. 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 Does This Data Suggest About Li Auto Insiders?

Insiders haven't bought Li Auto stock in the last three months, but there was some selling. And even if we look at the last year, we didn't see any purchases. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. 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. In terms of investment risks, we've identified 2 warning signs with Li Auto and understanding these should be part of your investment process.

Of course Li Auto 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.