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It is not uncommon to see companies perform well in the years after insiders buy shares. On the other hand, we’d be remiss not to mention that insider sales have been known to precede tough periods for a business. So shareholders might well want to know whether insiders have been buying or selling shares in Nicolet Bankshares, Inc. (NASDAQ:NCBS).
Do Insider Transactions Matter?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.’
The Last 12 Months Of Insider Transactions At Nicolet Bankshares
Chairman Robert Atwell made the biggest insider sale in the last 12 months. That single transaction was for US$311k worth of shares at a price of US$55.16 each. That means that an insider was selling shares at slightly below the current price (US$56.81). While their view may have changed since they sold, this isn’t a particularly bullish sign. As a general rule we consider it to be discouraging when insiders are selling below the current price. It is worth noting that this sale was only 9.7% of Robert Atwell’s holding.
Over the last year we saw more insider selling of Nicolet Bankshares shares, than buying. The average sell price was around US$55.41. It’s not too encouraging to see that insiders have sold at below the current price. Since insiders sell for many reasons, we wouldn’t put too much weight on it. 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!
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Nicolet Bankshares Insiders Are Selling The Stock
There was substantially more insider selling, than buying, of Nicolet Bankshares shares over the last three months. In that time, insiders dumped US$388k worth of shares. On the other hand we note Director Robert Weyers bought US$250k worth of shares, as previously mentioned. Generally this level of net selling might be considered a bit bearish.
Insider Ownership of Nicolet 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. It appears that Nicolet Bankshares insiders own 15% of the company, worth about US$80m. 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 Nicolet Bankshares Insider Transactions Indicate?
The stark truth for Nicolet Bankshares is that there has been more insider selling than insider buying in the last three months. Despite some insider buying, the longer term picture doesn’t make us feel much more positive. But since Nicolet Bankshares is profitable and growing, we’re not too worried by this. Insiders own shares, but we’re still pretty cautious, given the history of sales. So we’d only buy after careful consideration. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Nicolet Bankshares.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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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.