It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell Riverview Financial Corporation (NASDAQ:RIVE), you may well want to know whether insiders have been buying or selling.
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, rules govern insider transactions, and certain disclosures are required.
Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year.'
The Last 12 Months Of Insider Transactions At Riverview Financial
Notably, that recent purchase by Ginger Kunkel is the biggest insider purchase of Riverview Financial shares that we've seen in the last year. That means that even when the share price was higher than US$9.97 (the recent price), an insider wanted to purchase shares. 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.
In the last twelve months insiders paid US$249k for 23126.81 shares purchased. Riverview Financial insiders may have bought shares in the last year, but they didn't sell any. You can see a visual depiction of insider transactions (by 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!
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).
Riverview Financial Insiders Bought Stock Recently
Over the last quarter, Riverview Financial insiders have spent a meaningful amount on shares. In total, insiders bought US$144k worth of shares in that time, and we didn't record any sales whatsoever. This makes one think the business has some good points.
Insider Ownership of Riverview Financial
Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Based on our data, Riverview Financial insiders have about 2.9% of the stock, worth approximately US$2.7m. I generally like to see higher levels of ownership.
What Might The Insider Transactions At Riverview Financial Tell Us?
The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. While the overall levels of insider ownership are below what we'd like to see, the history of transactions imply that Riverview Financial insiders are reasonably well aligned, and optimistic for the future. I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.
Of course Riverview Financial 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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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. Thank you for reading.