Some UMB Financial Corporation (NASDAQ:UMBF) shareholders may be a little concerned to see that the Chairman & CEO, J. Kemper, recently sold a substantial US$1.2m worth of stock at a price of US$81.10 per share. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 0.8%.

The Last 12 Months Of Insider Transactions At UMB Financial

In fact, the recent sale by Chairman & CEO J. Kemper was not their only sale of UMB Financial shares this year. Earlier in the year, they fetched US$85.79 per share in a -US$2.1m sale. So we know that an insider sold shares at around the present share price of US$80.88. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. In this case, the big sale took place at around the current price, so it's not too bad (but it's still not a positive).

Over the last year, we can see that insiders have bought 1.74k shares worth US$123k. But insiders sold 156.57k shares worth US$12m. All up, insiders sold more shares in UMB Financial than they bought, over the last year. The average sell price was around US$75.70. We don't gain confidence from insider selling below the recent share 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!

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Insider Ownership Of UMB Financial

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. UMB Financial insiders own 4.8% of the company, currently worth about US$188m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Do The UMB Financial Insider Transactions Indicate?

An insider sold stock recently, but they haven't been buying. Despite some insider buying, the longer term picture doesn't make us feel much more positive. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. In terms of investment risks, we've identified 1 warning sign with UMB Financial and understanding this should be part of your investment process.

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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.