We'd be surprised if First Merchants Corporation (NASDAQ:FRME) shareholders haven't noticed that the Independent Director, Patrick Fehring, recently sold US$328k worth of stock at US$33.08 per share. On the bright side, that sale was only 6.5% of their holding, so we doubt it's very meaningful, on its own.
First Merchants Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider sale was by the Advisor & Director, Michael Rechin, for US$371k worth of shares, at about US$37.05 per share. That means that an insider was selling shares at around the current price of US$34.39. While we don't usually like to see insider selling, it's more concerning if the sales take place 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).
Over the last year, we can see that insiders have bought 1.84k shares worth US$65k. But they sold 19.90k shares for US$698k. Over the last year we saw more insider selling of First Merchants shares, than buying. 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!
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Does First Merchants Boast High Insider Ownership?
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. Insiders own 1.4% of First Merchants shares, worth about US$30m. 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 First Merchants Tell Us?
Unfortunately, there has been more insider selling of First Merchants stock, than buying, in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. 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. For example, First Merchants has 2 warning signs (and 1 which shouldn't be ignored) we think you should know about.
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 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.