Have Merchants Bancorp Insiders Been Selling Stock?

We wouldn't blame Merchants Bancorp (NASDAQ:MBIN) shareholders if they were a little worried about the fact that Michael Petrie, the Co-founder recently netted about US$1m selling shares at an average price of US$45.34. However, that sale only accounted for 0.2% of their holding, so arguably it doesn't say much about their conviction.

Check out our latest analysis for Merchants Bancorp

Merchants Bancorp Insider Transactions Over The Last Year

The Vice Chairman, Randall Rogers, made the biggest insider sale in the last 12 months. That single transaction was for US$7.7m worth of shares at a price of US$32.18 each. So it's clear an insider wanted to take some cash off the table, even below the current price of US$45.85. 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. It is worth noting that this sale was only 7.4% of Randall Rogers's holding.

Over the last year we saw more insider selling of Merchants Bancorp shares, than buying. 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!

I will like Merchants Bancorp better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Insider Ownership Of Merchants Bancorp

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. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that Merchants Bancorp insiders own 38% of the company, worth about US$792m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At Merchants Bancorp Tell Us?

The insider sales have outweighed the insider buying, at Merchants Bancorp, in the last three months. Zooming out, the longer term picture doesn't give us much comfort. On the plus side, Merchants Bancorp 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 these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example, Merchants Bancorp has 3 warning signs (and 1 which is significant) we think you should know about.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.