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 Coastal Financial Corporation (NASDAQ:CCB).
What Is Insider Selling?
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.
Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. 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.’
The Last 12 Months Of Insider Transactions At Coastal Financial
Chairman of the Board Andrew Skotdal made the biggest insider purchase in the last 12 months. That single transaction was for US$1.2m worth of shares at a price of US$14.50 each. That means that an insider was happy to buy shares at above the current price. Their view may have changed since then, but at least it shows they felt optimistic at the time. That purchase may suggest an expectation of positive returns over the long term.
Happily, we note that in the last year insiders bought 99.50k shares for a total of US$1.5m. In total, Coastal Financial insiders bought more than they sold over the last year. They paid about US$14.61 on average. I’d consider this a positive as it suggests insiders see value at around the current price, which is US$13.99. You can see the insider transactions 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!
Coastal Financial is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insiders at Coastal Financial Have Bought Stock Recently
Over the last three months, we’ve seen significant insider buying at Coastal Financial. Overall, 2 insiders shelled out US$100k for shares in the company — and none sold. This could be interpreted as suggesting a positive outlook.
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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It’s great to see that Coastal Financial insiders own 21% of the company, worth about US$35m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
What Might The Insider Transactions At Coastal Financial Tell Us?
It’s certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. Given that insiders also own a fair bit of Coastal Financial we think they are probably pretty confident of a bright future. Of course, the future is what matters most. So if you are interested in Coastal Financial, you should check out this free report on analyst forecasts for the company.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at email@example.com.