Great news for Community West Bancshares (NASDAQ:CWBC): Insiders acquired stock in large numbers last year
It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in Community West Bancshares' (NASDAQ:CWBC) case, it's fantastic news for shareholders.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
See our latest analysis for Community West Bancshares
The Last 12 Months Of Insider Transactions At Community West Bancshares
Over the last year, we can see that the biggest insider purchase was by Independent Director Robert Bartlein for US$105k worth of shares, at about US$11.50 per share. Even though the purchase was made at a significantly lower price than the recent price (US$14.06), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.
Happily, we note that in the last year insiders paid US$223k for 19.67k shares. But they sold 4.21k shares for US$58k. In total, Community West Bancshares insiders bought more than they sold over the last year. 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!
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.
Insiders At Community West Bancshares Have Sold Stock Recently
The last three months saw some Community West Bancshares insider selling. The selling netted US$48k for Independent Director & Secretary John Illgen. But US$16k was spent on buying, too, . While it's not great to see insider selling, the net amount sold isn't enough for us to want to read anything into it.
Does Community West Bancshares Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Community West Bancshares insiders own about US$31m worth of shares. That equates to 25% of the company. 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 Community West Bancshares Insider Transactions Indicate?
Our data shows a little more insider selling than buying in the last three months. But the difference isn't enough to have us worried. But insiders have shown more of an appetite for the stock, over the last year. Insiders own shares in Community West Bancshares and we see no evidence to suggest they are worried about the future. 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. While conducting our analysis, we found that Community West Bancshares has 1 warning sign and it would be unwise to ignore it.
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.
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.
Join A Paid User Research Session
You’ll receive a US$30 Amazon Gift card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here
