Don't Ignore The Insider Selling In ServisFirst Bancshares

Some ServisFirst Bancshares, Inc. (NYSE:SFBS) shareholders may be a little concerned to see that the Chairman, Thomas Broughton, recently sold a substantial US$2.0m worth of stock at a price of US$87.99 per share. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 1.7%.

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The Last 12 Months Of Insider Transactions At ServisFirst Bancshares

Over the last year, we can see that the biggest insider sale was by the Executive VP & COO, Rodney Rushing, for US$4.6m worth of shares, at about US$84.56 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$88.35. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. 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. We note that the biggest single sale was only 13% of Rodney Rushing's holding.

In the last year ServisFirst Bancshares insiders didn't buy any company stock. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

See our latest analysis for ServisFirst Bancshares

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Does ServisFirst Bancshares Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. ServisFirst Bancshares insiders own 7.6% of the company, currently worth about US$369m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Do The ServisFirst Bancshares Insider Transactions Indicate?

An insider sold ServisFirst Bancshares shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. On the plus side, ServisFirst Bancshares makes money, and is growing profits. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. You'd be interested to know, that we found 1 warning sign for ServisFirst Bancshares and we suggest you have a look.

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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.