Home Bancshares (Conway AR) Insiders Sold US$3.3m Of Shares Suggesting Hesitancy

The fact that multiple Home Bancshares, Inc. (Conway, AR) (NYSE:HOMB) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Home Bancshares (Conway AR)

Home Bancshares (Conway AR) Insider Transactions Over The Last Year

The insider, James Hickman, made the biggest insider sale in the last 12 months. That single transaction was for US$2.5m worth of shares at a price of US$25.43 each. That means that even when the share price was below the current price of US$26.65, an insider wanted to cash in some shares. 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. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. It is worth noting that this sale was only 20% of James Hickman's holding.

Over the last year, we can see that insiders have bought 25.00k shares worth US$554k. But insiders sold 131.03k shares worth US$3.3m. All up, insiders sold more shares in Home Bancshares (Conway AR) 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!

For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.

Home Bancshares (Conway AR) Insiders Are Selling The Stock

The last three months saw significant insider selling at Home Bancshares (Conway AR). Specifically, Chief Accounting Officer Jennifer Floyd ditched US$57k worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.

Insider Ownership Of Home Bancshares (Conway AR)

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. Home Bancshares (Conway AR) insiders own about US$357m worth of shares (which is 7.0% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

What Might The Insider Transactions At Home Bancshares (Conway AR) Tell Us?

An insider sold Home Bancshares (Conway AR) shares recently, but they didn't buy any. Despite some insider buying, the longer term picture doesn't make us feel much more positive. On the plus side, Home Bancshares (Conway AR) makes money, and is growing profits. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

But note: Home Bancshares (Conway AR) 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com