Investors may wish to note that the Chief Risk Officer of MainStreet Bancshares, Inc., Michael Baboval, recently netted US$53k from selling stock, receiving an average price of US$18.25. It might not be a huge sale, but it did reduce their holding size 32%, hardly encouraging.
MainStreet Bancshares Insider Transactions Over The Last Year
Notably, that recent sale by Michael Baboval is the biggest insider sale of MainStreet Bancshares shares that we've seen in the last year. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of US$18.40. 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. We note that the biggest single sale was only 32% of Michael Baboval's holding.
Over the last year, we can see that insiders have bought 8.83k shares worth US$151k. On the other hand they divested 2.89k shares, for US$53k. Overall, MainStreet Bancshares insiders were net buyers during the last year. 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!
There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insider Ownership
Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 10% of MainStreet Bancshares shares, worth about US$14m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Do The MainStreet Bancshares Insider Transactions Indicate?
We note that there's been a little more insider selling than buying, recently. But the net divestment is not enough to concern us at all. But insiders have shown more of an appetite for the stock, over the last year. Insiders do have a stake in MainStreet Bancshares and their transactions don't cause us concern. 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. Case in point: We've spotted 2 warning signs for MainStreet Bancshares you should be aware of.
Of course MainStreet Bancshares 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.
