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We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. 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 we’ll take a look at whether insiders have been buying or selling shares in Sierra Bancorp (NASDAQ:BSRR).
Do Insider Transactions Matter?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, most countries require that the company discloses such transactions to the market.
We don’t think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. 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 Sierra Bancorp
Over the last year, we can see that the biggest insider purchase was by Executive VP & Chief Banking Officer Michael Olague for US$403k worth of shares, at about US$26.89 per share. That means that even when the share price was higher than US$25.74 (the recent price), an insider wanted to purchase shares. 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. To us, it’s very important to consider the price insiders pay for shares is very important. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
In the last twelve months insiders purchased 39606 shares for US$1.1m. But insiders sold 7500 shares worth US$221k. In total, Sierra Bancorp insiders bought more than they sold over the last year. The chart below shows insider transactions (by individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Sierra Bancorp Insiders Bought Stock Recently
Over the last quarter, Sierra Bancorp insiders have spent a meaningful amount on shares. Overall, two insiders shelled out US$604k for shares in the company — and none sold. This is a positive in our book as it implies some confidence.
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. Insiders own 8.4% of Sierra Bancorp shares, worth about US$33m. We’ve certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Does This Data Suggest About Sierra Bancorp Insiders?
It’s certainly positive to see the recent insider purchases. And an analysis of the transactions over the last year also gives us confidence. Insiders likely see value in Sierra Bancorp shares, given these transactions (along with notable insider ownership of the company). Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Sierra Bancorp.
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 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.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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. Thank you for reading.