Don't Ignore The Fact That This Insider Just Sold Some Shares In Coastal Financial Corporation (NASDAQ:CCB)

By
Simply Wall St
Published
September 15, 2021
NasdaqGS:CCB
Source: Shutterstock

Anyone interested in Coastal Financial Corporation (NASDAQ:CCB) should probably be aware that a company insider, Andrew Dale, recently divested US$369k worth of shares in the company, at an average price of US$29.50 each. The eyebrow raising move amounted to a reduction of 21% in their holding.

Check out our latest analysis for Coastal Financial

The Last 12 Months Of Insider Transactions At Coastal Financial

The Independent Vice Chairman, Andrew Skotdal, made the biggest insider sale in the last 12 months. That single transaction was for US$419k worth of shares at a price of US$19.80 each. So it's clear an insider wanted to take some cash off the table, even below the current price of US$29.51. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 4.1% of Andrew Skotdal's holding. Notably Andrew Skotdal was also the biggest buyer, having purchased US$9.6k worth of shares.

All up, insiders sold more shares in Coastal Financial than they bought, over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
NasdaqGS:CCB Insider Trading Volume September 15th 2021

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Does Coastal 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. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Coastal Financial insiders own 20% of the company, worth about US$71m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Coastal Financial Insider Transactions Indicate?

An insider sold stock recently, but they haven't been buying. And our longer term analysis of insider transactions didn't bring confidence, either. But it is good to see that Coastal Financial is growing earnings. While insiders do own shares, they don't own a heap, and they have been selling. We're in no rush to buy! So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. In terms of investment risks, we've identified 1 warning sign with Coastal Financial and understanding this should be part of your investment process.

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’re looking to trade Coastal Financial, open an account with the lowest-cost* platform trusted by professionals, Interactive Brokers. Their clients from over 200 countries and territories trade stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted


Discounted cash flow calculation for every stock

Simply Wall St does a detailed discounted cash flow calculation every 6 hours for every stock on the market, so if you want to find the intrinsic value of any company just search here. It’s FREE.

Make Confident Investment Decisions

Simply Wall St's Editorial Team provides unbiased, factual reporting on global stocks using in-depth fundamental analysis.
Find out more about our editorial guidelines and team.