Stock Analysis

This Insider Has Just Sold Shares In Preferred Bank (NASDAQ:PFBC)

  •  Updated
NasdaqGS:PFBC
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Investors may wish to note that the Independent Vice Chairman of the Board of Preferred Bank, Clark Hsu, recently netted US$89k from selling stock, receiving an average price of US$44.46. However we note that the sale only shrunk their holding by 1.2%.

Check out our latest analysis for Preferred Bank

The Last 12 Months Of Insider Transactions At Preferred Bank

The Independent Director, Gary Nunnelly, made the biggest insider sale in the last 12 months. That single transaction was for US$477k worth of shares at a price of US$68.37 each. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is US$44.53. So it may not tell us anything about how insiders feel about the current share price.

In the last twelve months insiders purchased 3.10k shares for US$99k. On the other hand they divested 42.15k shares, for US$2.6m. Over the last year we saw more insider selling of Preferred Bank shares, than buying. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

insider-trading-volume
NasdaqGS:PFBC Insider Trading Volume December 14th 2020

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Insider Ownership of Preferred Bank

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. We usually like to see fairly high levels of insider ownership. It appears that Preferred Bank insiders own 8.7% of the company, worth about US$57m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At Preferred Bank Tell Us?

An insider sold Preferred Bank shares recently, but they didn't buy any. Despite some insider buying, the longer term picture doesn't make us feel much more positive. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We'd practice some caution before buying! 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 2 warning signs for Preferred Bank and we suggest you have a look.

Of course Preferred Bank may not be the best stock to buy. So you may wish to see this free collection of high quality 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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