Have Insiders Been Selling Pinnacle Financial Partners, Inc. (NASDAQ:PNFP) Shares?
It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we’ll take a look at whether insiders have been buying or selling shares in Pinnacle Financial Partners, Inc. (NASDAQ:PNFP).
What Is Insider Selling?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.
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. For example, a Columbia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
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Pinnacle Financial Partners Insider Transactions Over The Last Year
Executive VP & Chief Administrative Officer Hugh Queener made the biggest insider sale in the last 12 months. That single transaction was for US$1.4m worth of shares at a price of US$67.51 each. That is hardly a positive sign, even though it took place above the latest price (US$52.00). So it is hard to draw any strong conclusion from it.
In the last twelve months insiders netted US$4.1m for 62.03k shares sold. In total, Pinnacle Financial Partners insiders sold more than they bought over the last year. The sellers received a price of around US$66.84, on average. We are not joyful about insider selling. But we note that the selling, on average, was at well above the recently traded price of US$52.00. The chart below shows insider transactions (by individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Insider Ownership
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Pinnacle Financial Partners insiders own 3.2% of the company, currently worth about US$119m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Does This Data Suggest About Pinnacle Financial Partners Insiders?
There haven’t been any insider transactions in the last three months — that doesn’t mean much. While we feel good about high insider ownership of Pinnacle Financial Partners, we can’t say the same about the selling of shares. Of course, the future is what matters most. So if you are interested in Pinnacle Financial Partners, you should check out this free report on analyst forecasts for the company.
But note: Pinnacle Financial Partners 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.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
