It is not uncommon to see companies perform well in the years after insiders buy shares. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So we'll take a look at whether insiders have been buying or selling shares in HBT Financial, Inc. (NASDAQ:HBT).
What Is Insider Buying?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.
Insider transactions are not the most important thing when it comes to long-term investing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year.
HBT Financial Insider Transactions Over The Last Year
Independent Director Gerald Pfeiffer made the biggest insider purchase in the last 12 months. That single transaction was for US$480k worth of shares at a price of US$16.00 each. So it's clear an insider wanted to buy, at around the current price, which is US$18.61. That means they have been optimistic about the company in the past, though they may have changed their mind. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. Happily, the HBT Financial insiders decided to buy shares at close to current prices.
While HBT Financial insiders bought shares last year, they didn't sell. You can see the insider transactions (by 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!
HBT Financial is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
HBT Financial Insiders Bought Stock Recently
Over the last quarter, HBT Financial insiders have spent a meaningful amount on shares. Not only was there no selling that we can see, but they collectively bought US$1.8m worth of shares. That shows some optimism about the company's future.
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 2.6% of HBT Financial shares, worth about US$13m. 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 HBT Financial 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 HBT Financial shares, given these transactions (along with notable insider ownership of the company). Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for HBT Financial.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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