Usually, when one insider buys stock, it might not be a monumental event. But when multiple insiders are buying like they did in the case of Community Trust Bancorp, Inc. (NASDAQ:CTBI), that sends out a positive message to the company's shareholders.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
The Last 12 Months Of Insider Transactions At Community Trust Bancorp
Over the last year, we can see that the biggest insider purchase was by Independent Chairman & Lead Director M. Parrish for US$300k worth of shares, at about US$41.50 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$41.49). 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$519k for 12.50k shares. But they sold 5.78k shares for US$259k. Overall, Community Trust Bancorp insiders were net buyers during the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Community Trust Bancorp Insiders Bought Stock Recently
We saw some Community Trust Bancorp insider buying shares in the last three months. Director Charles Baird purchased US$20k worth of shares in that period. We like it when there are only buyers, and no sellers. However, in this case the amount invested recently is quite small.
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Community Trust Bancorp insiders own about US$35m worth of shares. That equates to 4.8% 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.
So What Do The Community Trust Bancorp Insider Transactions Indicate?
We note a that there has been a bit of insider buying recently (but no selling). Overall the buying isn't worth writing home about. But insiders have shown more of an appetite for the stock, over the last year. Overall we don't see anything to make us think Community Trust Bancorp insiders are doubting the company, and they do own shares. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Community Trust Bancorp. At Simply Wall St, we found 1 warning sign for Community Trust Bancorp that deserve your attention before buying any shares.
Of course Community Trust Bancorp 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, but not derivative transactions.
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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.