Possible Bearish Signals With Eagle Bancorp Insiders Disposing Stock

The fact that multiple Eagle Bancorp, Inc. (NASDAQ:EGBN) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

View our latest analysis for Eagle Bancorp

The Last 12 Months Of Insider Transactions At Eagle Bancorp

The insider, Lindsey Rheaume, made the biggest insider sale in the last 12 months. That single transaction was for US$506k worth of shares at a price of US$22.98 each. So what is clear is that an insider saw fit to sell at around the current price of US$22.09. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.

In the last twelve months insiders purchased 14.07k shares for US$262k. But insiders sold 31.28k shares worth US$721k. In total, Eagle Bancorp insiders sold more than they bought over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

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Insiders At Eagle Bancorp Have Bought Stock Recently

Over the last three months, we've seen significant insider buying at Eagle Bancorp. In total, insiders bought US$75k worth of shares in that time, and we didn't record any sales whatsoever. This could be interpreted as suggesting a positive outlook.

Does Eagle Bancorp 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. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Eagle Bancorp insiders own 3.3% of the company, worth about US$20m. 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 Do The Eagle Bancorp Insider Transactions Indicate?

The recent insider purchases are heartening. On the other hand the transaction history, over the last year, isn't so positive. While recent transactions indicate confidence in Eagle Bancorp, insiders don't own enough of the company to overcome our cautiousness about the longer term transactions. Overall they seem reasonably aligned. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 1 warning sign for Eagle Bancorp you should be aware of.

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 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.