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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 we’ll take a look at whether insiders have been buying or selling shares in Byline Bancorp, Inc. (NYSE:BY).
What Is Insider Buying?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, such insiders must disclose their trading activities, and not trade on inside information.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But equally, we would consider it foolish to ignore insider transactions altogether. 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.’
Byline Bancorp Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider sale was by the Director, Robert Yohanan, for US$201k worth of shares, at about US$20.20 per share. So we know that an insider sold shares at around the present share price of US$19.09. We generally don’t like to see insider selling, but the lower the sale price, the more it concerns us. We note that this sale took place at around the current price, so it isn’t a major concern, though it’s hardly a good sign.
Happily, we note that in the last year insiders paid US$116k for 5905 shares. On the other hand they divested 21799 shares, for US$436k. Over the last year we saw more insider selling of Byline Bancorp shares, than buying. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Insiders at Byline Bancorp Have Sold Stock Recently
We’ve seen more insider selling than insider buying at Byline Bancorp recently. In that time, insiders dumped US$335k worth of shares. On the flip side, insiders spent US$95k on purchasing shares. Since the selling really does outweigh the buying, we’d say that these transactions may suggest that some insiders feel the shares are not cheap.
Does Byline Bancorp Boast High 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. We usually like to see fairly high levels of insider ownership. Insiders own 2.7% of Byline Bancorp shares, worth about US$19m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Do The Byline Bancorp Insider Transactions Indicate?
The insider sales have outweighed the insider buying, at Byline Bancorp, in the last three months. And our longer term analysis of insider transactions didn’t bring confidence, either. On the plus side, Byline Bancorp makes money, and is growing profits. Insider ownership isn’t particularly high, so this analysis makes us cautious about the company. We’re in no rush to buy! Of course, the future is what matters most. So if you are interested in Byline Bancorp, you should check out this free report on analyst forecasts for the company.
If you would prefer to check out another company — one with potentially superior financials — then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.