Independent Director Of Federal Agricultural Mortgage Sold 42% Of Their Shares

Anyone interested in Federal Agricultural Mortgage Corporation (NYSE:AGM) should probably be aware that the Independent Director, Sara Faivre-Davis, recently divested US$386k worth of shares in the company, at an average price of US$188 each. The eyebrow raising move amounted to a reduction of 42% in their holding.

View our latest analysis for Federal Agricultural Mortgage

Federal Agricultural Mortgage Insider Transactions Over The Last Year

Notably, that recent sale by Sara Faivre-Davis is the biggest insider sale of Federal Agricultural Mortgage shares that we've seen in the last year. That means that an insider was selling shares at around the current price of US$184. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign.

In the last twelve months insiders purchased 739.42 shares for US$97k. But insiders sold 3.93k shares worth US$736k. In total, Federal Agricultural Mortgage insiders sold more than they bought over the last year. The average sell price was around US$187. It's not particularly great to see insiders were selling shares at below recent prices. Since insiders sell for many reasons, we wouldn't put too much weight on it. 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!

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Insider Ownership Of Federal Agricultural Mortgage

For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Federal Agricultural Mortgage insiders own about US$29m worth of shares. That equates to 1.5% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At Federal Agricultural Mortgage Tell Us?

The stark truth for Federal Agricultural Mortgage is that there has been more insider selling than insider buying in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. But since Federal Agricultural Mortgage is profitable and growing, we're not too worried by this. Insiders own shares, but we're still pretty cautious, given the history of sales. We'd practice some caution before buying! While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For instance, we've identified 2 warning signs for Federal Agricultural Mortgage (1 doesn't sit too well with us) you should be aware of.

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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.