Multiple insiders bought Oak Valley Bancorp (NASDAQ:OVLY) 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 Oak Valley Bancorp (NASDAQ:OVLY), it sends a favourable message to the company's shareholders.
Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.
View our latest analysis for Oak Valley Bancorp
The Last 12 Months Of Insider Transactions At Oak Valley Bancorp
In the last twelve months, the biggest single purchase by an insider was when Independent Director Janet Pelton bought US$95k worth of shares at a price of US$18.97 per share. That means that an insider was happy to buy shares at above the current price of US$17.40. 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. 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.
Over the last year, we can see that insiders have bought 25.57k shares worth US$458k. But they sold 5.40k shares for US$97k. In the last twelve months there was more buying than selling by Oak Valley Bancorp insiders. The chart below shows insider transactions (by companies and 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!
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).
Insiders at Oak Valley Bancorp Have Bought Stock Recently
There was some insider buying at Oak Valley Bancorp over the last quarter. They bought US$60k worth in that time. However, Independent Vice Chairman of the Board James Gilbert netted US$27k for sales. It is good to see that insiders have been buying, but they did not buy very many shares, in the scheme of things.
Insider Ownership of Oak Valley Bancorp
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 19% of Oak Valley Bancorp shares, worth about US$27m. 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 Oak Valley Bancorp Insider Transactions Indicate?
We note a that there has been a bit of insider buying recently (but no selling). Overall the buying isn't worth writing home about. On a brighter note, the transactions over the last year are encouraging. Overall we don't see anything to make us think Oak Valley Bancorp insiders are doubting the company, and they do own shares. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Oak Valley Bancorp. In terms of investment risks, we've identified 1 warning sign with Oak Valley Bancorp and understanding it should be part of your investment process.
But note: Oak Valley Bancorp 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.
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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.
