Have Insiders Sold TowneBank Shares Recently?

Anyone interested in TowneBank (NASDAQ:TOWN) should probably be aware that a company insider, J. Davis, recently divested US$305k worth of shares in the company, at an average price of US$33.58 each. That sale was 22% of their holding, so it does make us raise an eyebrow.

Check out our latest analysis for TowneBank

TowneBank Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the Independent Director, Elizabeth Robertson, for US$453k worth of shares, at about US$27.63 per share. That means that an insider was selling shares at slightly below the current price (US$33.24). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 21% of Elizabeth Robertson's holding.

Happily, we note that in the last year insiders paid US$1.7m for 63.11k shares. But insiders sold 77.50k shares worth US$2.2m. All up, insiders sold more shares in TowneBank than they bought, over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

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Insider Ownership Of TowneBank

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. TowneBank insiders own about US$186m worth of shares (which is 7.6% 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 TowneBank Insiders?

The insider sales have outweighed the insider buying, at TowneBank, in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. It is good to see high insider ownership, but the insider selling leaves us cautious. While it's good to be aware of 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. For example - TowneBank has 1 warning sign we think you should be aware of.

Of course TowneBank 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 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