Insider Sellers Might Regret Selling First Financial Bankshares Shares at a Lower Price Than Current Market Value

First Financial Bankshares, Inc.'s (NASDAQ:FFIN) value has fallen 10% in the last week, but insiders who sold US$1.3m worth of stock over the last year have had less success. Insiders would probably have been better off holding on to their shares given that the average selling price of US$40.82 is still lower than the current share price.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

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The Last 12 Months Of Insider Transactions At First Financial Bankshares

The Chairman & CEO, F. Dueser, made the biggest insider sale in the last 12 months. That single transaction was for US$1.0m worth of shares at a price of US$40.73 each. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The good news is that this large sale was at well above current price of US$32.17. So it is hard to draw any strong conclusion from it.

Happily, we note that in the last year insiders paid US$674k for 21.33k shares. On the other hand they divested 32.00k shares, for US$1.3m. All up, insiders sold more shares in First Financial Bankshares than they bought, over the last year. The average sell price was around US$40.82. It is certainly not great to see that insiders have sold shares in the company. But the selling was at much higher prices than the current share price (US$32.17), so it probably doesn't tell us a lot about the value on offer today. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Check out our latest analysis for First Financial Bankshares

I will like First Financial Bankshares 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 First Financial Bankshares Have Bought Stock Recently

It's good to see that First Financial Bankshares insiders have made notable investments in the company's shares. Not only was there no selling that we can see, but they collectively bought US$248k worth of shares. That shows some optimism about the company's future.

Does First Financial Bankshares 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. First Financial Bankshares insiders own about US$172m worth of shares (which is 3.8% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At First Financial Bankshares Tell Us?

The recent insider purchases are heartening. On the other hand the transaction history, over the last year, isn't so positive. The high levels of insider ownership, and the recent buying by some insiders suggests they are well aligned and optimistic. Of course, the future is what matters most. So if you are interested in First Financial Bankshares, 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.

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.