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 we’ll take a look at whether insiders have been buying or selling shares in AmeriServ Financial, Inc. (NASDAQ:ASRV).
Do Insider Transactions Matter?
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. As Peter Lynch said, ‘insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.
Check out our latest analysis for AmeriServ Financial
AmeriServ Financial Insider Transactions Over The Last Year
In the last twelve months, the biggest single sale by an insider was when the President & CEO of Ameriserv Trust and Financial Services Company, James Huerth, sold US$67k worth of shares at a price of US$4.17 per share. So it’s clear an insider wanted to take some cash off the table, even slightly below the current price of US$4.18. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. While insider selling is not a positive sign, we can’t be sure if it does mean insiders think the shares are fully valued, so it’s only a weak sign. This single sale was 89% of James Huerth’s stake. James Huerth was the only individual insider to sell shares in the last twelve months.
Over the last year, we can see that insiders have bought 3.83k shares worth US$16k. But insiders sold 16000 shares worth US$67k. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).
Insiders at AmeriServ Financial Have Sold Stock Recently
Over the last three months, we’ve seen notably more insider selling, than insider buying, at AmeriServ Financial. In that time, President & CEO of Ameriserv Trust and Financial Services Company James Huerth dumped US$67k worth of shares. On the flip side, Independent Director Robert Wise spent US$1.4k on purchasing shares. Since the selling really does outweigh the buying, we’d say that these transactions may suggest that some insiders feel the shares are not cheap.
Does AmeriServ Financial Boast High 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. Insiders own 7.8% of AmeriServ Financial shares, worth about US$5.6m, according to our data. We do generally prefer see higher levels of insider ownership.
So What Do The AmeriServ Financial Insider Transactions Indicate?
The stark truth for AmeriServ Financial is that there has been more insider selling than insider buying in the last three months. Despite some insider buying, the longer term picture doesn’t make us feel much more positive. But since AmeriServ Financial is profitable and growing, we’re not too worried by this. When you combine this with the relatively low insider ownership, we are very cautious about the stock. We’d certainly think twice before buying! I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow for free.
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.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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.
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. Thank you for reading.