We often see insiders buying up shares in companies that perform well over the long term. On the other hand, we’d be remiss not to mention that insider sales have been known to precede tough periods for a business. So shareholders might well want to know whether insiders have been buying or selling shares in SVB Financial Group (NASDAQ:SIVB).
Do Insider Transactions Matter?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, such insiders must disclose their trading activities, and not trade on inside information.
Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Columbia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
The Last 12 Months Of Insider Transactions At SVB Financial Group
Over the last year, we can see that the biggest insider sale was by the insider, Christopher Edmonds-Waters, for US$414k worth of shares, at about US$241 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The good news is that this large sale was at well above current price of US$195. So it is hard to draw any strong conclusion from it.
In total, SVB Financial Group insiders sold more than they bought over the last year. You can see the insider transactions (by individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
SVB Financial Group Insiders Bought Stock Recently
It’s good to see that SVB Financial Group insiders have made notable investments in the company’s shares. Specifically, John Clendening bought US$199k worth of shares in that time, and we didn’t record any sales whatsoever. This could be interpreted as suggesting a positive outlook.
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that SVB Financial Group insiders own 0.5% of the company, worth about US$54m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
What Might The Insider Transactions At SVB Financial Group Tell Us?
It is good to see the recent insider purchase. But we can’t say the same for the transactions over the last 12 months. The more recent transactions are a positive, but SVB Financial Group insiders haven’t shown the sustained enthusiasm that we look for, although they do own a decent number of shares, overall. So they seem pretty well aligned, overall. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for SVB Financial Group.
But note: SVB Financial Group 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.
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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