We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell PCSB Financial Corporation (NASDAQ:PCSB), you may well want to know whether insiders have been buying or selling.
What Is Insider Buying?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, such insiders must disclose their trading activities, and not trade on inside information.
We don’t think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. 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 PCSB Financial
In the last twelve months, the biggest single purchase by an insider was when Executive VP & CFO Scott Nogles bought US$80k worth of shares at a price of US$20.00 per share. That means that an insider was happy to buy shares at above the current price. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company’s future. It’s not at all bad to see insiders buy shares at or above current prices.
Happily, we note that in the last year insiders bought 10.40k shares for a total of US$205k. In total, PCSB Financial insiders bought more than they sold over the last year. The average buy price was around US$19.69. I’d consider this a positive as it suggests insiders see value at around the current price, which is US$18.67. The chart below shows insider transactions 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!
PCSB Financial is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insiders at PCSB Financial Have Bought Stock Recently
There was some insider buying at PCSB Financial over the last quarter. Scott Nogles purchased US$28k worth of shares in that period. It’s great to see that insiders are only buying, not selling. But the amount invested in the last three months isn’t enough for us too put much weight on it, as a single factor.
Insider Ownership of PCSB Financial
For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It’s great to see that PCSB Financial insiders own 5.3% of the company, worth about US$17m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Do The PCSB Financial Insider Transactions Indicate?
We note a that there has been a tad more insider buying than selling, recently. But the net investment is not enough to encourage us much. However, our analysis of transactions over the last year is heartening. Overall we don’t see anything to make us think PCSB Financial insiders are doubting the company, and they do own shares. 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.
But note: PCSB Financial 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 firstname.lastname@example.org.