We often see insiders buying up shares in companies that perform well over the long term. 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 before you buy or sell Bridgewater Bancshares, Inc. (NASDAQ:BWB), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, rules govern insider transactions, and certain disclosures are required.
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 Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.’
Bridgewater Bancshares Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Director Douglas Parish for US$99k worth of shares, at about US$12.39 per share. That means that even when the share price was higher than US$11.56 (the recent price), an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
Happily, we note that in the last year insiders paid US$133k for 11000 shares. But they sold 5000 for US$57k. In the last twelve months there was more buying than selling by Bridgewater Bancshares insiders. 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!
Are Bridgewater Bancshares Insiders Buying Or Selling?
There was some insider buying at Bridgewater Bancshares over the last quarter. Douglas Parish purchased US$6.0k worth of shares in that period. It’s great to see that insiders are only buying, not selling. However, in this case the amount invested recently is quite small.
Does Bridgewater Bancshares Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Insiders own 18% of Bridgewater Bancshares shares, worth about US$58m. While this is a strong but not outstanding level of insider ownership, it’s enough to indicate some alignment between management and smaller shareholders.
What Might The Insider Transactions At Bridgewater Bancshares Tell Us?
Our data shows a little insider buying, but no selling, in the last three months. Overall the buying isn’t worth writing home about. On a brighter note, the transactions over the last year are encouraging. Overall we don’t see anything to make us think Bridgewater Bancshares insiders are doubting the company, and they do own shares. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.
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 email@example.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. Thank you for reading.