How Much Are Bogota Financial Corp. (NASDAQ:BSBK) Insiders Spending On Buying Shares?

We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So shareholders might well want to know whether insiders have been buying or selling shares in Bogota Financial Corp. (NASDAQ:BSBK).

What Is Insider Buying?

It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, such insiders must disclose their trading activities, and not trade on inside information.

We don't think shareholders should simply follow insider transactions. 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'.

Check out our latest analysis for Bogota Financial

The Last 12 Months Of Insider Transactions At Bogota Financial

The Independent Director John Masterson made the biggest insider purchase in the last 12 months. That single transaction was for US$207k worth of shares at a price of US$11.00 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$8.96). 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. In our view, the price an insider pays for shares is very important. 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.

While Bogota Financial insiders bought shares during the last year, they didn't sell. They paid about US$9.51 on average. These transactions suggest that insiders have considered the current price attractive. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insider Ownership of Bogota Financial

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Our data suggests Bogota Financial insiders own 1.7% of the company, worth about US$2.0m. But they may have an indirect interest through a corporate structure that we haven't picked up on. We consider this fairly low insider ownership.

What Might The Insider Transactions At Bogota Financial Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. On a brighter note, the transactions over the last year are encouraging. The transactions are fine but it'd be more encouraging if Bogota Financial insiders bought more shares in the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Bogota Financial. At Simply Wall St, we found 1 warning sign for Bogota Financial that deserve your attention before buying any shares.

But note: Bogota 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, but not derivative transactions.

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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. 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.
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