One Mercantile Bank Insider Raised Stake By 104% In Previous Year
From what we can see, insiders were net buyers in Mercantile Bank Corporation's (NASDAQ:MBWM ) during the past 12 months. That is, insiders acquired the stock in greater numbers than they sold it.
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.
Check out our latest analysis for Mercantile Bank
Mercantile Bank Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider sale was by the Independent Chairman, Michael Price, for US$137k worth of shares, at about US$34.33 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$35.14. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. This single sale was just 6.2% of Michael Price's stake.
David Ramaker bought a total of 7.50k shares over the year at an average price of US$32.89. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Mercantile Bank Insiders Are Selling The Stock
Over the last three months, we've seen significant insider selling at Mercantile Bank. In total, Independent Chairman Michael Price sold US$137k worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.
Insider Ownership
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. Mercantile Bank insiders own about US$43m worth of shares. That equates to 7.6% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
So What Do The Mercantile Bank Insider Transactions Indicate?
An insider hasn't bought Mercantile Bank stock in the last three months, but there was some selling. On the other hand, the insider transactions over the last year are encouraging. And insiders do own shares. So we're not overly bothered by recent selling. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Mercantile Bank. Every company has risks, and we've spotted 2 warning signs for Mercantile Bank (of which 1 shouldn't be ignored!) you should know about.
Of course Mercantile Bank 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.
