Yahoo Finance With Bank of America Corporation's (NYSE:BAC)) price down 7.0% this week, insiders might find some solace having sold US$6.0m worth of shares earlier this year.
Insiders seem to have made the most of their holdings by selling US$6.0m worth of Bank of America Corporation (NYSE:BAC) stock at an average sell price of US$45.76 during the past year. The company’s market cap plunged by US$19b after price dropped by 7.0% last week but insiders were able to limit their loss to an extent.
While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
View our latest analysis for Bank of America
The Last 12 Months Of Insider Transactions At Bank of America
Over the last year, we can see that the biggest insider sale was by the insider, Dean Athanasia, for US$5.0m worth of shares, at about US$45.77 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. It's of some comfort that this sale was conducted at a price well above the current share price, which is US$31.73. So it may not shed much light on insider confidence at current levels.
In the last year Bank of America insiders didn't buy any company stock. 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!
I will like Bank of America better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Does Bank of America Boast High 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. Bank of America insiders own 0.2% of the company, currently worth about US$440m 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 Does This Data Suggest About Bank of America Insiders?
There haven't been any insider transactions in the last three months -- that doesn't mean much. While we feel good about high insider ownership of Bank of America, we can't say the same about the selling of shares. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. While conducting our analysis, we found that Bank of America has 1 warning sign and it would be unwise to ignore this.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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, 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.
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