We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. 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 shareholders might well want to know whether insiders have been buying or selling shares in Independent Bank Corp. (NASDAQ:INDB).
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, most countries require that the company discloses such transactions to the market.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. 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 Independent Bank
In the last twelve months, the biggest single sale by an insider was when Director Gerard Nadeau sold US$290k worth of shares at a price of US$72.90 per share. So we know that an insider sold shares at around the present share price of US$69.67. They might be selling for a variety of reasons, but it’s hard to argue this is a bullish sign. Arguably, insider selling at around current prices should give us reason to reflect on whether the stock is fully valued at the moment.
In the last twelve months insiders netted US$1.5m for 18.47k shares sold. Over the last year we saw more insider selling of Independent Bank shares, than buying. They sold for an average price of about US$78.62. It’s not ideal to see that insiders have sold at around the current price. But we don’t put too much weight on the insider selling, since sellers could have personal reasons. You can see a visual depiction of insider transactions over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Have Independent Bank Insiders Traded Recently?
Over the last three months, we’ve seen a bit of insider selling at Independent Bank. Senior VP Mark Ruggiero only netted US$7.9k selling shares, in that period. It’s not great to see insider selling, nor the lack of recent buyers. But the amount sold isn’t enough for us to put any weight on it.
Insider Ownership of Independent Bank
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. It’s great to see that Independent Bank insiders own 2.2% of the company, worth about US$43m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
So What Does This Data Suggest About Independent Bank Insiders?
Our data shows a little more insider selling than buying in the last three months. But the net divestment is not enough to concern us at all. Recent sales exacerbate our caution arising from analysis of Independent Bank insider transactions. The modest level of insider ownership is, at least, some comfort. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Independent Bank.
But note: Independent Bank 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 email@example.com.