Investors who take an interest in United Bankshares, Inc. (NASDAQ:UBSI) should definitely note that the Executive Chairman of the Board, Richard Adams, recently paid US$33.60 per share to buy US$261k worth of the stock. Although the purchase is not a big one, by either a percentage standpoint or absolute value, it can be seen as a good sign.
The Last 12 Months Of Insider Transactions At United Bankshares
In fact, the recent purchase by Richard Adams was the biggest purchase of United Bankshares shares made by an insider individual in the last twelve months, according to our records. That means that even when the share price was higher than US$33.26 (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. In our view, the price an insider pays for shares is very important. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. Richard Adams was the only individual insider to buy during the last year.
The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
United Bankshares is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insider Ownership of United Bankshares
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 1.9% of United Bankshares shares, worth about US$85m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Do The United Bankshares Insider Transactions Indicate?
The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. Given that insiders also own a fair bit of United Bankshares we think they are probably pretty confident of a bright future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example - United Bankshares has 1 warning sign we think you should be aware of.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.