More money in the bank for insiders who divested US$1.5m worth of PennyMac Mortgage Investment Trust (NYSE:PMT) shares last year

By
Simply Wall St
Published
January 10, 2022
NYSE:PMT
Source: Shutterstock

Last week, PennyMac Mortgage Investment Trust's (NYSE:PMT) stock jumped 4.1%, but insiders who sold US$1.5m worth of stock in over the past year are likely to be in a better position. Selling at an average price of US$20.44, which is higher than the current price, may have been the wisest decision for these insiders as their investment would have been worth less now than when they sold.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

View our latest analysis for PennyMac Mortgage Investment Trust

The Last 12 Months Of Insider Transactions At PennyMac Mortgage Investment Trust

In the last twelve months, the biggest single sale by an insider was when the Independent Trustee, Marianne Sullivan, sold US$1.4m worth of shares at a price of US$20.55 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The good news is that this large sale was at well above current price of US$18.04. So it may not shed much light on insider confidence at current levels.

PennyMac Mortgage Investment Trust insiders didn't buy any shares over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

insider-trading-volume
NYSE:PMT Insider Trading Volume January 10th 2022

I will like PennyMac Mortgage Investment Trust better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Insider Ownership of PennyMac Mortgage Investment Trust

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. PennyMac Mortgage Investment Trust insiders own about US$16m worth of shares. That equates to 0.9% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The PennyMac Mortgage Investment Trust Insider Transactions Indicate?

The fact that there have been no PennyMac Mortgage Investment Trust insider transactions recently certainly doesn't bother us. Still, the insider transactions at PennyMac Mortgage Investment Trust in the last 12 months are not very heartening. The modest level of insider ownership is, at least, some comfort. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing PennyMac Mortgage Investment Trust. For example - PennyMac Mortgage Investment Trust has 3 warning signs we think you should be aware of.

But note: PennyMac Mortgage Investment Trust may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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, but not derivative transactions.

Discounted cash flow calculation for every stock

Simply Wall St does a detailed discounted cash flow calculation every 6 hours for every stock on the market, so if you want to find the intrinsic value of any company just search here. It’s FREE.

Make Confident Investment Decisions

Simply Wall St's Editorial Team provides unbiased, factual reporting on global stocks using in-depth fundamental analysis.
Find out more about our editorial guidelines and team.