Need To Know: National Bankshares, Inc. (NASDAQ:NKSH) Insiders Have Been Buying Shares

We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in National Bankshares, Inc. (NASDAQ:NKSH).

What Is Insider Selling?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.

We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise'.

Check out our latest analysis for National Bankshares

National Bankshares Insider Transactions Over The Last Year

The Independent Director Lawrence Ball made the biggest insider purchase in the last 12 months. That single transaction was for US$58k worth of shares at a price of US$29.00 each. That means that an insider was happy to buy shares at around the current price of US$31.96. 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. The good news for National Bankshares share holders is that insiders were buying at near the current price.

Over the last year, we can see that insiders have bought 10.35k shares worth US$315k. But they sold 1.00 shares for US$31.3. In total, National Bankshares insiders bought more than they sold over the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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).

National Bankshares Insiders Bought Stock Recently

We saw some National Bankshares insider buying shares in the last three months. Independent Director Mary Miller bought US$16k worth of shares in that time. But Independent Director Mildred Johnson sold US$31.3 worth. It is good to see that insiders have been buying, but they did not buy very many shares, in the scheme of things.

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. 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 2.5% of National Bankshares shares, worth about US$5.1m, according to our data. We do generally prefer see higher levels of insider ownership.

So What Does This Data Suggest About National Bankshares Insiders?

Insider purchases may have been minimal, in the last three months, but there was no selling at all. The net investment is not enough to encourage us much. However, our analysis of transactions over the last year is heartening. The transactions are fine but it'd be more encouraging if National Bankshares insiders bought more shares in the company. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. You'd be interested to know, that we found 1 warning sign for National Bankshares 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, but not derivative transactions.

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This article by Simply Wall St is general in nature. 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.
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