Insider Buying: The Pacific Mercantile Bancorp (NASDAQ:PMBC) CEO, President & Director Just Bought 39% More Shares
Even if it's not a huge purchase, we think it was good to see that Bradford Dinsmore, the CEO, President & Director of Pacific Mercantile Bancorp (NASDAQ:PMBC) recently shelled out US$80k to buy stock, at US$3.65 per share. While we're hesitant to get too excited about a purchase of that size, we do note it increased their holding by a solid 39%.
Check out our latest analysis for Pacific Mercantile Bancorp
Pacific Mercantile Bancorp Insider Transactions Over The Last Year
In fact, the recent purchase by CEO, President & Director Bradford Dinsmore was not their only acquisition of Pacific Mercantile Bancorp shares this year. They previously made an even bigger purchase of US$223k worth of shares at a price of US$7.98 per share. That means that an insider was happy to buy shares at above the current price of US$3.58. It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares is very important. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
Over the last year, we can see that insiders have bought 128.09k shares worth US$675k. On the other hand they divested 10129 shares, for US$76k. In total, Pacific Mercantile Bancorp insiders bought more than they sold over the last year. They paid about US$5.27 on average. This is nice to see since it implies that insiders might see value around current prices. You can see the insider transactions (by individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Does Pacific Mercantile Bancorp Boast High Insider Ownership?
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Based on our data, Pacific Mercantile Bancorp insiders have about 3.1% of the stock, worth approximately US$2.5m. I generally like to see higher levels of ownership.
So What Do The Pacific Mercantile Bancorp Insider Transactions Indicate?
The recent insider purchases are heartening. And the longer term insider transactions also give us confidence. While the overall levels of insider ownership are below what we'd like to see, the history of transactions imply that Pacific Mercantile Bancorp insiders are reasonably well aligned, and optimistic for the future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Pacific Mercantile Bancorp. Every company has risks, and we've spotted 4 warning signs for Pacific Mercantile Bancorp (of which 1 can't be ignored!) you should know about.
Of course Pacific Mercantile Bancorp 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, but not derivative transactions.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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