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Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of Five Star Bancorp (NASDAQ:FSBC), it sends a favourable message to the company's shareholders.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.
See our latest analysis for Five Star Bancorp
Five Star Bancorp Insider Transactions Over The Last Year
The Independent Director Robert Perry-Smith made the biggest insider purchase in the last 12 months. That single transaction was for US$422k worth of shares at a price of US$29.68 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$26.59). Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
Happily, we note that in the last year insiders paid US$1.7m for 62.40k shares. On the other hand they divested 1.17k shares, for US$34k. In the last twelve months there was more buying than selling by Five Star Bancorp insiders. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Five Star Bancorp is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Five Star Bancorp Insiders Bought Stock Recently
It's good to see that Five Star Bancorp insiders have made notable investments in the company's shares. Overall, two insiders shelled out US$106k for shares in the company -- and none sold. This makes one think the business has some good points.
Insider Ownership
For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Five Star Bancorp insiders own 36% of the company, currently worth about US$166m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
What Might The Insider Transactions At Five Star Bancorp Tell Us?
It is good to see recent purchasing. And the longer term insider transactions also give us confidence. When combined with notable insider ownership, these factors suggest Five Star Bancorp insiders are well aligned, and quite possibly think the share price is too low. Looks promising! 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. For example - Five Star Bancorp has 1 warning sign we think you should be aware of.