Stock Analysis

This Insider Has Just Sold Shares In Customers Bancorp, Inc. (NYSE:CUBI)

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NYSE:CUBI
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We'd be surprised if Customers Bancorp, Inc. (NYSE:CUBI) shareholders haven't noticed that an insider, Glenn Hedde, recently sold US$118k worth of stock at US$18.00 per share. However, the silver lining is that the sale only reduced their total holding by 7.8%, so we're hesitant to read anything much into it, on its own.

View our latest analysis for Customers Bancorp

Customers Bancorp Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Head of Corporate Development & COO Samvir Sidhu bought US$261k worth of shares at a price of US$20.85 per share. That means that an insider was happy to buy shares at above the current price of US$18.94. 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. To us, it's very important to consider the price insiders pay for shares. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. The only individual insider to buy over the last year was Samvir Sidhu.

In total, Customers Bancorp insiders sold more than they bought over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. 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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NYSE:CUBI Insider Trading Volume December 7th 2020

I will like Customers Bancorp better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Does Customers Bancorp Boast High 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. 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 8.3% of Customers Bancorp shares, worth about US$50m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At Customers Bancorp Tell Us?

Insiders sold stock recently, but they haven't been buying. And our longer term analysis of insider transactions didn't bring confidence, either. On the plus side, Customers Bancorp makes money, and is growing profits. Insiders own shares, but we're still pretty cautious, given the history of sales. So we'd only buy after careful consideration. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Customers Bancorp. To help with this, we've discovered 3 warning signs (1 is a bit concerning!) that you ought to be aware of before buying any shares in Customers Bancorp.

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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