Quite a few OceanFirst Financial Corp. (NASDAQ:OCFC) insiders sold their shares over the past year, which may be a cause for concern. When evaluating insider transactions, knowing whether insiders are buying versus if they selling is usually more beneficial, as the latter can be open to many interpretations. However, shareholders should take a deeper look if several insiders are selling stock over a specific time period.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

The Last 12 Months Of Insider Transactions At OceanFirst Financial

In the last twelve months, the biggest single sale by an insider was when the Chairman & CEO, Christopher Maher, sold US$160k worth of shares at a price of US$14.90 per share. That means that even when the share price was below the current price of US$16.14, 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 2.9% of Christopher Maher's stake.

In the last twelve months insiders purchased 16.45k shares for US$236k. But insiders sold 35.18k shares worth US$524k. In total, OceanFirst 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!

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

OceanFirst Financial Insiders Are Selling The Stock

Over the last three months, we've seen significant insider selling at OceanFirst Financial. Specifically, insiders ditched US$524k worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.

Does OceanFirst Financial Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that OceanFirst Financial insiders own 3.5% of the company, worth about US$33m. 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 OceanFirst Financial Insider Transactions Indicate?

Insiders haven't bought OceanFirst Financial stock in the last three months, but there was some selling. And our longer term analysis of insider transactions didn't bring confidence, either. While insiders do own shares, they don't own a heap, and they have been selling. So we'd only buy after careful consideration. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. To assist with this, we've discovered 1 warning sign that you should run your eye over to get a better picture of OceanFirst Financial.

Of course OceanFirst 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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