This Insider Has Just Sold Shares In MetroCity Bankshares

We wouldn't blame MetroCity Bankshares, Inc. (NASDAQ:MCBS) shareholders if they were a little worried about the fact that Nack Paek, the Chairman & CEO recently netted about US$1.5m selling shares at an average price of US$30.82. However, that sale only accounted for 3.7% of their holding, so arguably it doesn't say much about their conviction.

See our latest analysis for MetroCity Bankshares

The Last 12 Months Of Insider Transactions At MetroCity Bankshares

In fact, the recent sale by Nack Paek was the biggest sale of MetroCity Bankshares shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to take some cash off the table, even below the current price of US$31.97. 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. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 3.7% of Nack Paek's holding.

Nack Paek divested 100.00k shares over the last 12 months at an average price of US$25.68. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

I will like MetroCity 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.

Insider Ownership

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. MetroCity Bankshares insiders own about US$229m worth of shares (which is 28% 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.

So What Does This Data Suggest About MetroCity Bankshares Insiders?

The stark truth for MetroCity Bankshares is that there has been more insider selling than insider buying in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. It is good to see high insider ownership, but the insider selling leaves us cautious. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing MetroCity Bankshares. At Simply Wall St, we found 2 warning signs for MetroCity Bankshares that deserve your attention before buying any shares.

But note: MetroCity Bankshares 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 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com