Multiple insiders secured a larger position in M&T Bank Corporation (NYSE:MTB) shares over the last 12 months. This is reassuring as this suggests that insiders have increased optimism about the company’s prospects.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Check out our latest analysis for M&T Bank
M&T Bank Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Senior EVP & Chief Financial Officer Daryl Bible bought US$1.2m worth of shares at a price of US$121 per share. That implies that an insider found the current price of US$127 per share to be enticing. That means they have been optimistic about the company in the past, though they may have changed their mind. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today’s share price, as the discount to value may have narrowed with the rising price. The good news for M&T Bank share holders is that insiders were buying at near the current price.
Happily, we note that in the last year insiders paid US$1.8m for 15.39k shares. But insiders sold 4.03k shares worth US$517k. In the last twelve months there was more buying than selling by M&T Bank insiders. 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!
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).
M&T Bank Insiders Bought Stock Recently
Over the last three months, we’ve seen significantly more insider buying, than insider selling, at M&T Bank. In total, Senior EVP & Chief Financial Officer Daryl Bible bought US$555k worth of shares in that time. On the other hand, insider Doris Meister netted US$111k by selling. We think insiders may be optimistic about the future, since insiders have been net buyers of shares.
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it’s a good sign if insiders own a significant number of shares in the company. M&T Bank insiders own 0.5% of the company, currently worth about US$107m 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 M&T Bank Insider Transactions Indicate?
It is good to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. When combined with notable insider ownership, these factors suggest M&T Bank insiders are well aligned, and quite possibly think the share price is too low. That’s what I like to see! While we like knowing 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. While conducting our analysis, we found that M&T Bank has 1 warning sign and it would be unwise to ignore it.
But note: M&T Bank 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.
What are the risks and opportunities for M&T Bank?
Trading at 60% below our estimate of its fair value
Earnings grew by 84% over the past year
Earnings are forecast to decline by an average of 5.7% per year for the next 3 years
View all Risks and Rewards
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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.