Anyone interested in Webster Financial Corporation (NYSE:WBS) should probably be aware that a company insider, Thomas Geisel, recently divested US$431k worth of shares in the company, at an average price of US$57.43 each. The eyebrow raising move amounted to a reduction of 15% in their holding.
Webster Financial Insider Transactions Over The Last Year
In fact, the recent sale by Thomas Geisel was the biggest sale of Webster Financial shares made by an insider individual in the last twelve months, according to our records. That means that even when the share price was slightly below the current price of US$57.68, an insider wanted to cash in some shares. 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. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. This single sale was just 15% of Thomas Geisel's stake.
In total, Webster Financial insiders sold more 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. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Insider Ownership of Webster Financial
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. Webster Financial insiders own 1.1% of the company, currently worth about US$116m based on the recent share price. 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 Webster Financial Tell Us?
The insider sales have outweighed the insider buying, at Webster Financial, in the last three months. Zooming out, the longer term picture doesn't give us much comfort. But it is good to see that Webster Financial is growing earnings. It is good to see high insider ownership, but the insider selling leaves us cautious. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Webster Financial. To that end, you should learn about the 2 warning signs we've spotted with Webster Financial (including 1 which is a bit concerning).
Of course Webster Financial may not be the best stock to buy. So you may wish to see this free collection of high quality 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.
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.