37% Of This Cadence Bank Insider's Holdings Were Sold

Looking at Cadence Bank's (NYSE:CADE ) insider transactions over the last year, we can see that insiders were net sellers. That is, there were more number of shares sold by insiders than there were purchased.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Cadence Bank

Cadence Bank Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Special Advisor to the Chief Banking Officer, Rudolph Holmes, sold US$525k worth of shares at a price of US$21.00 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$27.74. 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. This single sale was just 37% of Rudolph Holmes's stake. The only individual insider seller over the last year was Rudolph Holmes.

You can see a visual depiction of insider transactions (by companies and 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!

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Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. It appears that Cadence Bank insiders own 1.4% of the company, worth about US$70m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The Cadence Bank Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Cadence Bank shares in the last quarter. We don't take much encouragement from the transactions by Cadence Bank insiders. The modest level of insider ownership is, at least, some comfort. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Cadence Bank. In terms of investment risks, we've identified 1 warning sign with Cadence Bank and understanding this should be part of your investment process.

But note: Cadence Bank 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.