Don't Ignore The Insider Selling In Provident Financial Services
Some Provident Financial Services, Inc. (NYSE:PFS) shareholders may be a little concerned to see that the Director, Thomas Shara, recently sold a substantial US$1.3m worth of stock at a price of US$23.13 per share. That sale reduced their total holding by 11% which is hardly insignificant, but far from the worst we've seen.
Provident Financial Services Insider Transactions Over The Last Year
In fact, the recent sale by Thomas Shara was the biggest sale of Provident Financial Services shares made by an insider individual in the last twelve months, according to our records. That means that even when the share price was slightly below the current price of US$23.39, an insider wanted to cash in some shares. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was just 11% of Thomas Shara's stake.
Insiders in Provident Financial Services didn't buy any shares in the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
See our latest analysis for Provident Financial Services
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Insider Ownership Of Provident Financial Services
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Provident Financial Services insiders own about US$95m worth of shares. That equates to 3.2% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
What Might The Insider Transactions At Provident Financial Services Tell Us?
Insiders sold Provident Financial Services shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. But it is good to see that Provident Financial Services is growing earnings. While insiders do own shares, they don't own a heap, and they have been selling. So we'd only buy after careful consideration. 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. In terms of investment risks, we've identified 1 warning sign with Provident Financial Services and understanding this should be part of your investment process.
Of course Provident Financial Services 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 of direct interests only, but not derivative transactions or indirect interests.
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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.