Bullish United Overseas Bank Insiders Loaded Up On S$3.3m Of Stock

Over the last year, a good number of insiders have significantly increased their holdings in United Overseas Bank Limited (SGX:U11). This is encouraging because it indicates that insiders are more optimistic about the company's prospects.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for United Overseas Bank

The Last 12 Months Of Insider Transactions At United Overseas Bank

Over the last year, we can see that the biggest insider purchase was by Deputy Chairman & CEO Ee Cheong Wee for S$3.0m worth of shares, at about S$29.57 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being S$28.30). While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. We always take careful note of the price insiders pay when purchasing shares. 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 United Overseas Bank insiders were buying shares, but not selling. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

United Overseas Bank is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that United Overseas Bank insiders own 16% of the company, worth about S$7.5b. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Does This Data Suggest About United Overseas Bank Insiders?

It doesn't really mean much that no insider has traded United Overseas Bank shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. With high insider ownership and encouraging transactions, it seems like United Overseas Bank insiders think the business has merit. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example - United Overseas Bank has 1 warning sign we think you should be aware of.

Of course United Overseas Bank 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.

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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.