Co-Founder & Executive Chairman of First National Financial Stephen J. Smith Buys More Stock

Those following along with First National Financial Corporation (TSE:FN) will no doubt be intrigued by the recent purchase of shares by Stephen J. Smith, Co-Founder & Executive Chairman of the company, who spent a stonking CA$1.0m on stock at an average price of CA$38.81. While that only increased their holding size by 0.1%, it is still a big swing by our standards.

View our latest analysis for First National Financial

First National Financial Insider Transactions Over The Last Year

In fact, the recent purchase by Co-Founder & Executive Chairman Stephen J. Smith was not their only acquisition of First National Financial shares this year. They previously made an even bigger purchase of CA$9.8m worth of shares at a price of CA$33.06 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of CA$39.44. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

In the last twelve months First National Financial insiders were buying shares, but not selling. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

First National Financial is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Does First National Financial Boast High 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. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that First National Financial insiders own 38% of the company, worth about CA$895m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The First National Financial Insider Transactions Indicate?

The recent insider purchase is heartening. We also take confidence from the longer term picture of insider transactions. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about First National Financial. One for the watchlist, at least! While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For example, First National Financial has 2 warning signs (and 1 which is concerning) we think you should know about.

But note: First National Financial 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 of direct interests only, but not derivative transactions or indirect interests.

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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.