Looking at First Merchants Corporation's (NASDAQ:FRME ) insider transactions over the last year, we can see that insiders were net sellers. That is, there were more number of shares sold by insiders than there were purchased.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

See our latest analysis for First Merchants

The Last 12 Months Of Insider Transactions At First Merchants

In the last twelve months, the biggest single sale by an insider was when the Advisor & Director, Michael Rechin, sold US$371k worth of shares at a price of US$37.05 per share. That means that an insider was selling shares at around the current price of US$35.69. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. In this case, the big sale took place at around the current price, so it's not too bad (but it's still not a positive). Michael Rechin was the only individual insider to sell over the last year.

Over the last year, we can see that insiders have bought 1.84k shares worth US$65k. But they sold 10.00k shares for US$371k. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Insiders At First Merchants Have Sold Stock Recently

We've seen more insider selling than insider buying at First Merchants recently. In total, Advisor & Director Michael Rechin sold US$371k worth of shares in that time. On the flip side, Independent Director Michael Fisher spent US$50k on purchasing shares. Because the selling vastly outweighs the buying, we'd say this is a somewhat bearish sign.

Insider Ownership Of First Merchants

For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. First Merchants insiders own about US$32m worth of shares. That equates to 1.5% 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.

So What Does This Data Suggest About First Merchants Insiders?

The insider sales have outweighed the insider buying, at First Merchants, in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. But since First Merchants is profitable and growing, we're not too worried by this. Insiders own shares, but we're still pretty cautious, given the history of sales. We'd practice some caution before buying! 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. To that end, you should learn about the 2 warning signs we've spotted with First Merchants (including 1 which is concerning).

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.