Read This Before Selling Plumas Bancorp (NASDAQ:PLBC) Shares
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 shareholders might well want to know whether insiders have been buying or selling shares in Plumas Bancorp (NASDAQ:PLBC).
What Is Insider Selling?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
We don’t think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. As Peter Lynch said, ‘insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.’
Check out our latest analysis for Plumas Bancorp
Plumas Bancorp Insider Transactions Over The Last Year
In the last twelve months, the biggest single sale by an insider was when Director William Elliott sold US$56k worth of shares at a price of US$28.01 per share. That means that an insider was selling shares at around the current price of US$22.94. While their view may have changed since the sale, this is not a particularly positive fact. Arguably, insider selling at around current prices should give us reason to reflect on whether the stock is fully valued at the moment. The only individual insider seller over the last year was William Elliott.
Over the last year, we can see that insiders have bought 8.14k shares worth US$201k. On the other hand they divested 2.00k shares, for US$56k. Overall, Plumas Bancorp insiders were net buyers last year. The average buy price was around US$24.63. These transactions suggest that insiders have considered the current price of US$22.94 attractive. You can see a visual depiction of insider transactions over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
Plumas Bancorp is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Plumas Bancorp Insiders Bought Stock Recently
Over the last three months, we’ve seen significant insider buying at Plumas Bancorp. Overall, 3 insiders shelled out US$85k for shares in the company — and none sold. This could be interpreted as suggesting a positive outlook.
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. A high insider ownership often makes company leadership more mindful of shareholder interests. Plumas Bancorp insiders own about US$12m worth of shares (which is 11% of the company). Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
What Might The Insider Transactions At Plumas Bancorp Tell Us?
It’s certainly positive to see the recent insider purchases. And an analysis of the transactions over the last year also gives us confidence. Given that insiders also own a fair bit of Plumas Bancorp we think they are probably pretty confident of a bright future. Along with insider transactions, I recommend checking if Plumas Bancorp is growing revenue. This free chart of historic revenue and earnings should make that easy.
But note: Plumas 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.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
