Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of Evolent Health, Inc. (NYSE:EVH), it sends a favourable message to the company's shareholders.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

We've discovered 1 warning sign about Evolent Health. View them for free.

The Last 12 Months Of Insider Transactions At Evolent Health

Over the last year, we can see that the biggest insider purchase was by Co-Founder Seth Blackley for US$498k worth of shares, at about US$9.01 per share. That implies that an insider found the current price of US$9.23 per share to be enticing. Of course they may have changed their mind. But this suggests they are optimistic. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. Happily, the Evolent Health insiders decided to buy shares at close to current prices.

In the last twelve months Evolent Health insiders were buying shares, but not selling. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, 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 Evolent Health

Evolent Health 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.

Evolent Health Insiders Bought Stock Recently

It's good to see that Evolent Health insiders have made notable investments in the company's shares. Overall, nine insiders shelled out US$1.3m for shares in the company -- and none sold. That shows some optimism about the company's future.

Does Evolent Health Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. It appears that Evolent Health insiders own 1.6% of the company, worth about US$17m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The Evolent Health Insider Transactions Indicate?

The recent insider purchases are heartening. And the longer term insider transactions also give us confidence. But we don't feel the same about the fact the company is making losses. Insiders likely see value in Evolent Health 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. You'd be interested to know, that we found 1 warning sign for Evolent Health and we suggest you have a look.

Of course Evolent Health 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.

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.