Even if it's not a huge purchase, we think it was good to see that Michael Voinovich, the Independent Director of Middlefield Banc Corp. (NASDAQ:MBCN) recently shelled out US$67k to buy stock, at US$23.99 per share. That purchase might not be huge but it did increase their holding by 26%.
The Last 12 Months Of Insider Transactions At Middlefield Banc
Notably, that recent purchase by Michael Voinovich is the biggest insider purchase of Middlefield Banc shares that we've seen in the last year. That means that an insider was happy to buy shares at around the current price of US$24.11. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. In this case we're pleased to report that the insider purchases were made at close to current prices.
Middlefield Banc insiders may have bought shares in the last year, but they didn't sell any. The average buy price was around US$20.87. We don't deny that it is nice to see insiders buying stock in the company. But we must note that the investments were made at well below today's share price. 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!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insider Ownership of Middlefield Banc
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 7.8% of Middlefield Banc shares, worth about US$12m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At Middlefield Banc Tell Us?
The recent insider purchases are heartening. We also take confidence from the longer term picture of insider transactions. When combined with notable insider ownership, these factors suggest Middlefield Banc insiders are well aligned, and that they may think the share price is too low. Of course, the future is what matters most. So if you are interested in Middlefield Banc, you should check out this free report on analyst forecasts for the company.
But note: Middlefield Banc may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
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, but not derivative transactions.
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