Insiders At East West Bancorp Sold US$5.9m In Stock, Alluding To Potential Weakness

Many East West Bancorp, Inc. (NASDAQ:EWBC) insiders ditched their stock over the past year, which may be of interest to the company's shareholders. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, if numerous insiders are selling, shareholders should investigate more.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

View our latest analysis for East West Bancorp

East West Bancorp Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Vice Chairman & Chief Corporate Officer, Douglas Krause, sold US$1.3m worth of shares at a price of US$107 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The silver lining is that this sell-down took place above the latest price (US$93.89). So it may not shed much light on insider confidence at current levels.

East West Bancorp insiders didn't buy any shares over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

I will like East West Bancorp better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Insiders At East West Bancorp Have Sold Stock Recently

The last three months saw significant insider selling at East West Bancorp. Specifically, Independent Director Chi-Husan Liu ditched US$209k worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.

Insider Ownership Of East West Bancorp

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that East West Bancorp insiders own 1.0% of the company, worth about US$132m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About East West Bancorp Insiders?

An insider sold East West Bancorp shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. But since East West Bancorp is profitable and growing, we're not too worried by this. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. Of course, the future is what matters most. So if you are interested in East West Bancorp, you should check out this free report on analyst forecasts for the company.

Of course East West Bancorp may not be the best stock to buy. So you may wish to see this free collection of high quality 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.