Oportun Financial's Insiders' Timely Sale May Have Helped Mitigate 12% Dip in Share Price

Insiders at Oportun Financial Corporation (NASDAQ:OPRT) sold US$582k worth of stock at an average price of US$5.33 a share over the past year, making the most of their investment. The company's market valuation decreased by US$40m after the stock price dropped 12% over the past week, but insiders were spared from painful losses.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

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The Last 12 Months Of Insider Transactions At Oportun Financial

Over the last year, we can see that the biggest insider sale was by the Chief Credit Officer, Patrick Kirscht, for US$272k worth of shares, at about US$5.99 per share. That means that even when the share price was below the current price of US$6.78, an insider wanted to cash in some shares. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower 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 18% of Patrick Kirscht's stake.

Happily, we note that in the last year insiders paid US$318k for 81.76k shares. On the other hand they divested 109.12k shares, for US$582k. In total, Oportun 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. By clicking on the graph below, you can see the precise details of each insider transaction!

View our latest analysis for Oportun Financial

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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. We usually like to see fairly high levels of insider ownership. It appears that Oportun Financial insiders own 7.0% of the company, worth about US$21m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Do The Oportun Financial Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Oportun Financial shares in the last quarter. Our analysis of Oportun Financial insider transactions leaves us cautious. But it's good to see that insiders own shares in the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Oportun Financial. Case in point: We've spotted 1 warning sign for Oportun Financial you should be aware of.

Of course Oportun 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 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.