We'd be surprised if Plumas Bancorp (NASDAQ:PLBC) shareholders haven't noticed that the Executive VP & Chief Credit Officer of Plumas Bank, Jeffrey Moore, recently sold US$179k worth of stock at US$42.71 per share. In particular, we note that the sale equated to a 100% reduction in their position size, which doesn't exactly instill confidence.
The Last 12 Months Of Insider Transactions At Plumas Bancorp
Notably, that recent sale by Jeffrey Moore is the biggest insider sale of Plumas Bancorp shares that we've seen in the last year. That means that even when the share price was slightly below the current price of US$43.05, an insider wanted to cash in some shares. 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 100% of Jeffrey Moore's holding.
Over the last year, we can see that insiders have bought 1.67k shares worth US$60k. On the other hand they divested 7.83k shares, for US$325k. In total, Plumas Bancorp insiders sold more than they bought over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
I will like Plumas Bancorp better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.
Insider Ownership
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Plumas Bancorp insiders own about US$20m worth of shares. That equates to 8.1% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At Plumas Bancorp Tell Us?
Insiders 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. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We'd practice some caution before buying! 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 3 warning signs for Plumas Bancorp you should be aware of, and 1 of these is a bit concerning.
But note: Plumas Bancorp 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 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.
