We'd be surprised if UMB Financial Corporation (NASDAQ:UMBF) shareholders haven't noticed that the Chairman, J. Kemper, recently sold US$291k worth of stock at US$83.10 per share. On the bright side, that sale was only 0.2% of their holding, so we doubt it's very meaningful, on its own.
The Last 12 Months Of Insider Transactions At UMB Financial
In fact, the recent sale by Chairman J. Kemper was not their only sale of UMB Financial shares this year. They previously made an even bigger sale of -US$708k worth of shares at a price of US$88.38 per share. So we know that an insider sold shares at around the present share price of US$80.35. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.
Happily, we note that in the last year insiders paid US$702k for 11.35k shares. But insiders sold 86.00k shares worth US$6.1m. In total, UMB Financial insiders sold more than they bought over the last year. The sellers received a price of around US$70.58, on average. It's not too encouraging to see that insiders have sold at below the current price. But we wouldn't put too much weight on the insider selling. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Insider Ownership Of UMB Financial
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. UMB Financial insiders own about US$202m worth of shares (which is 5.2% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
What Might The Insider Transactions At UMB Financial Tell Us?
The insider sales have outweighed the insider buying, at UMB Financial, in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. It is good to see high insider ownership, but the insider selling leaves us cautious. 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. Case in point: We've spotted 1 warning sign for UMB Financial you should be aware of.
Of course UMB 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.
