Need To Know: Valley National Bancorp (NASDAQ:VLY) Insiders Have Been Selling Shares
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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 we’ll take a look at whether insiders have been buying or selling shares in Valley National Bancorp (NASDAQ:VLY).
Do Insider Transactions Matter?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, such insiders must disclose their trading activities, and not trade on inside information.
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. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.’
See our latest analysis for Valley National Bancorp
The Last 12 Months Of Insider Transactions At Valley National Bancorp
In the last twelve months, the biggest single sale by an insider was when Chairman of the Board Gerald Lipkin sold US$3.3m worth of shares at a price of US$12.82 per share. That is hardly a positive sign, even though it took place above the latest price (US$10.60). So it may not shed much light on insider confidence at current levels.
In total, Valley National Bancorp insiders sold more than they bought over the last year. They sold for an average price of about US$12.82. Insider selling doesn’t make us excited to buy. However, we do note that the average sale price was significantly higher than the current share price (which is US$10.60). 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!
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Valley National Bancorp Insiders Are Selling The Stock
The last quarter saw substantial insider selling of Valley National Bancorp shares. Specifically, insiders ditched US$59k 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 Valley National Bancorp
Many investors like to check how much of a company is owned by insiders. I reckon it’s a good sign if insiders own a significant number of shares in the company. Valley National Bancorp insiders own 3.1% of the company, currently worth about US$108m 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 Do The Valley National Bancorp Insider Transactions Indicate?
Insiders haven’t bought Valley National Bancorp stock in the last three months, but there was some selling. And our longer term analysis of insider transactions didn’t bring confidence, either. On the plus side, Valley National Bancorp makes money, and is growing profits. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn’t make us feel confident about the company. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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.
