Anyone interested in Provident Financial Services, Inc. (NYSE:PFS) should probably be aware that a company insider, Walter Sierotko, recently divested US$325k worth of shares in the company, at an average price of US$21.10 each. The eyebrow raising move amounted to a reduction of 26% in their holding.
Provident Financial Services Insider Transactions Over The Last Year
In fact, the recent sale by Walter Sierotko was the biggest sale of Provident Financial Services shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of US$21.32. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. We note that the biggest single sale was only 26% of Walter Sierotko's holding.
In the last twelve months insiders purchased 1.96k shares for US$31k. On the other hand they divested 32.42k shares, for US$631k. All up, insiders sold more shares in Provident Financial Services than they bought, over 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!
I will like Provident Financial Services better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.
Insider Ownership Of Provident Financial Services
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Provident Financial Services insiders own about US$95m worth of shares. That equates to 3.4% 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 Does This Data Suggest About Provident Financial Services Insiders?
Insiders sold stock recently, but they haven't been buying. And our longer term analysis of insider transactions didn't bring confidence, either. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We'd practice some caution before buying! 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. Our analysis shows 5 warning signs for Provident Financial Services (1 is significant!) and we strongly recommend you look at them before investing.
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 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.
