Multiple insiders bought Old Second Bancorp, Inc. (NASDAQ:OSBC) stock earlier this year, a positive sign for shareholders
Usually, when one insider buys stock, it might not be a monumental event. But when multiple insiders are buying like they did in the case of Old Second Bancorp, Inc. (NASDAQ:OSBC), that sends out a positive 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 Old Second Bancorp
Old Second Bancorp Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Independent Lead Director Barry Finn for US$164k worth of shares, at about US$16.44 per share. That means that an insider was happy to buy shares at above the current price of US$16.25. Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. 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.
Happily, we note that in the last year insiders paid US$249k for 15.92k shares. But they sold 13.67k shares for US$196k. In the last twelve months there was more buying than selling by Old Second Bancorp insiders. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Old Second Bancorp is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Old Second Bancorp Insiders Bought Stock Recently
It's good to see that Old Second Bancorp insiders have made notable investments in the company's shares. In total, insiders bought US$179k worth of shares in that time, and we didn't record any sales whatsoever. That shows some optimism about the company's future.
Insider Ownership
Many investors like to check how much of a company is owned by 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 appears that Old Second Bancorp insiders own 5.6% of the company, worth about US$41m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Do The Old Second Bancorp Insider Transactions Indicate?
It is good to see recent purchasing. And the longer term insider transactions also give us confidence. Insiders likely see value in Old Second Bancorp shares, given these transactions (along with notable insider ownership of the company). While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. To assist with this, we've discovered 1 warning sign that you should run your eye over to get a better picture of Old Second Bancorp.
Of course Old Second Bancorp may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
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.
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