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It is not uncommon to see companies perform well in the years after insiders buy shares. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So before you buy or sell Fulton Financial Corporation (NASDAQ:FULT), you may well want to know whether insiders have been buying or selling.
What Is Insider Buying?
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.
We don't think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.'
The Last 12 Months Of Insider Transactions At Fulton Financial
In the last twelve months, the biggest single purchase by an insider was when Independent Director Ronald Spair bought US$335k worth of shares at a price of US$16.73 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$16.38). It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
Happily, we note that in the last year insiders paid US$468k for 28002 shares. But they sold 21941.31 for US$363k. Overall, Fulton Financial insiders were net buyers last year. The chart below shows insider transactions (by individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
Fulton Financial is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Fulton Financial Insiders Are Selling The Stock
The last three months saw significant insider selling at Fulton Financial. In total, insiders sold US$138k worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.
Insider Ownership of Fulton Financial
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. Fulton Financial insiders own about US$29m worth of shares. That equates to 1.1% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
What Might The Insider Transactions At Fulton Financial Tell Us?
Insiders sold stock recently, but they haven't been buying. On the other hand, the insider transactions over the last year are encouraging. And insiders do own shares. So we're happy enough to look past some selling. Of course, the future is what matters most. So if you are interested in Fulton Financial, you should check out this free report on analyst forecasts for the company.
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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.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. Thank you for reading.