Favourable Signals For United Bankshares: Numerous Insiders Acquired Stock
It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in United Bankshares, Inc.'s (NASDAQ:UBSI) case, it's fantastic news for shareholders.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
See our latest analysis for United Bankshares
United Bankshares Insider Transactions Over The Last Year
The insider Lacy Rice made the biggest insider purchase in the last 12 months. That single transaction was for US$294k worth of shares at a price of US$29.43 each. That implies that an insider found the current price of US$30.84 per share to be enticing. 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. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. Happily, the United Bankshares insiders decided to buy shares at close to current prices.
Happily, we note that in the last year insiders paid US$460k for 15.77k shares. But they sold 2.50k shares for US$107k. In total, United Bankshares insiders bought more than they sold over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
United Bankshares Insiders Bought Stock Recently
We saw some United Bankshares insider buying shares in the last three months. Independent Director Gary White shelled out US$11k for shares in that time. We like it when there are only buyers, and no sellers. However, in this case the amount invested recently is quite small.
Insider Ownership
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 2.2% of United Bankshares shares, worth about US$90m. 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 United Bankshares Insider Transactions Indicate?
We note a that there has been a bit of insider buying recently (but no selling). Overall the buying isn't worth writing home about. On a brighter note, the transactions over the last year are encouraging. Overall we don't see anything to make us think United Bankshares insiders are doubting the company, and they do own shares. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. In terms of investment risks, we've identified 1 warning sign with United Bankshares and understanding it should be part of your investment process.
But note: United Bankshares 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 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.
