First Mid Bancshares Repeat Insider Selling Not A Positive Indicator

Quite a few First Mid Bancshares, Inc. (NASDAQ:FMBH) insiders sold their shares over the past year, which may be a cause for concern. When evaluating insider transactions, knowing whether insiders are buying versus if they selling is usually more beneficial, as the latter can be open to many interpretations. However, if numerous insiders are selling, shareholders should investigate more.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for First Mid Bancshares

The Last 12 Months Of Insider Transactions At First Mid Bancshares

The Director, Todd James, made the biggest insider sale in the last 12 months. That single transaction was for US$371k worth of shares at a price of US$30.57 each. That means that an insider was selling shares at slightly below the current price (US$31.64). As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. We note that the biggest single sale was only 16% of Todd James's holding.

In the last twelve months insiders purchased 11.00k shares for US$250k. On the other hand they divested 13.15k shares, for US$402k. In total, First Mid Bancshares 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!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).

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. A high insider ownership often makes company leadership more mindful of shareholder interests. First Mid Bancshares insiders own 15% of the company, currently worth about US$115m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

What Might The Insider Transactions At First Mid Bancshares Tell Us?

It doesn't really mean much that no insider has traded First Mid Bancshares shares in the last quarter. It's great to see high levels of insider ownership, but looking back over the last year, we don't gain confidence from the First Mid Bancshares insiders selling. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing First Mid Bancshares. You'd be interested to know, that we found 2 warning signs for First Mid Bancshares and we suggest you have a look.

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.