Independent Director Richard Sanborn Sold A Bunch Of Shares In Enterprise Financial Services

We wouldn't blame Enterprise Financial Services Corp (NASDAQ:EFSC) shareholders if they were a little worried about the fact that Richard Sanborn, the Independent Director recently netted about US$6.0m selling shares at an average price of US$59.56. That diminished their holding by a very significant 71%, which arguably implies a strong desire to reallocate capital.

View our latest analysis for Enterprise Financial Services

Enterprise Financial Services Insider Transactions Over The Last Year

In fact, the recent sale by Richard Sanborn was the biggest sale of Enterprise Financial Services shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of US$60.19. 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 71% of Richard Sanborn's holding.

Richard Sanborn sold a total of 196.92k shares over the year at an average price of US$56.60. 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!

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Does Enterprise Financial Services Boast High Insider Ownership?

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Enterprise Financial Services insiders own about US$77m worth of shares. That equates to 3.6% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Enterprise Financial Services Insiders?

An insider sold Enterprise Financial Services shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. Insiders own shares, but we're still pretty cautious, given the history of sales. So we'd only buy after careful consideration. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Enterprise Financial Services. At Simply Wall St, we found 1 warning sign for Enterprise Financial Services that deserve your attention before buying any shares.

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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 of direct interests only, but not derivative transactions or indirect interests.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.