Those following along with Live Oak Bancshares, Inc. (NASDAQ:LOB) will no doubt be intrigued by the recent purchase of shares by James Mahan, Chairman & CEO of the company, who spent a stonking US$866k on stock at an average price of US$19.09. While that only increased their holding size by 0.7%, it is still a big swing by our standards.
The Last 12 Months Of Insider Transactions At Live Oak Bancshares
Over the last year, we can see that the biggest insider purchase was by President & Director Neil Underwood for US$1.1m worth of shares, at about US$11.46 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$19.62. Because the shares were purchased at a lower price, this particular buy doesn’t tell us much about how insiders feel about the current share price.
In the last twelve months Live Oak Bancshares insiders were buying shares, but not selling. Their average price was about US$13.66. To my mind it is good that insiders have invested their own money in the company. But we must note that the investments were made at well below today’s share price. 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!
Live Oak Bancshares is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
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. It’s great to see that Live Oak Bancshares insiders own 25% of the company, worth about US$200m. 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 Live Oak Bancshares Tell Us?
The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Live Oak Bancshares. That’s what I like to see! In addition to knowing about insider transactions going on, it’s beneficial to identify the risks facing Live Oak Bancshares. At Simply Wall St, we’ve found that Live Oak Bancshares has 3 warning signs (1 makes us a bit uncomfortable!) that deserve your attention before going any further with your analysis.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.
This article by Simply Wall St is general in nature. 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.