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Multiple insiders bought Arbor Realty Trust, Inc. (NYSE:ABR) stock earlier this year, a positive sign for shareholders

Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of Arbor Realty Trust, Inc. (NYSE:ABR), it sends a favourable message to the company's shareholders.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Arbor Realty Trust

The Last 12 Months Of Insider Transactions At Arbor Realty Trust

Notably, that recent purchase by William Green is the biggest insider purchase of Arbor Realty Trust shares that we've seen in the last year. That means that even when the share price was higher than US$15.11 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.

In the last twelve months Arbor Realty Trust insiders were buying shares, but not selling. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

insider-trading-volume
insider-trading-volume

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Arbor Realty Trust Insiders Bought Stock Recently

Over the last three months, we've seen significant insider buying at Arbor Realty Trust. Lead Independent Director William Green spent US$142k on stock, and there wasn't any selling. That shows some optimism about the company's future.

Insider Ownership Of Arbor Realty Trust

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. It appears that Arbor Realty Trust insiders own 1.9% of the company, worth about US$54m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Arbor Realty Trust Insider Transactions Indicate?

It is good to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. Insiders likely see value in Arbor Realty Trust shares, given these transactions (along with notable insider ownership of the company). So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 3 warning signs for Arbor Realty Trust you should be aware of, and 1 of them doesn't sit too well with us.

But note: Arbor Realty Trust 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.

For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions, but not derivative transactions.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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