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Trade Alert: The Independent Director Of Ocwen Financial Corporation (NYSE:OCN), Jacques Busquet, Has Just Spent US$115k Buying 71% More Shares

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Potential Ocwen Financial Corporation (NYSE:OCN) shareholders may wish to note that the Independent Director, Jacques Busquet, recently bought US$115k worth of stock, paying US$28.75 for each share. We reckon that's a good sign, especially since the purchase boosted their holding by 71%.

View our latest analysis for Ocwen Financial

The Last 12 Months Of Insider Transactions At Ocwen Financial

Notably, that recent purchase by Jacques Busquet is the biggest insider purchase of Ocwen Financial shares that we've seen in the last year. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$27.45). It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

While Ocwen Financial insiders bought shares during the last year, they didn't sell. They paid about US$23.29 on average. To my mind it is good that insiders have invested their own money in the company. However, we do note that they were buying at significantly lower prices than today's share price. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

insider-trading-volume
insider-trading-volume

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.

Does Ocwen Financial Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Ocwen Financial insiders own about US$24m worth of shares. That equates to 9.5% 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.

What Might The Insider Transactions At Ocwen Financial Tell Us?

It is good to see the recent insider purchase. And the longer term insider transactions also give us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. When combined with notable insider ownership, these factors suggest Ocwen Financial insiders are well aligned, and that they may think the share price is too low. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. In terms of investment risks, we've identified 2 warning signs with Ocwen Financial and understanding them should be part of your investment process.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.

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.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.