We wouldn't blame UMB Financial Corporation (NASDAQ:UMBF) shareholders if they were a little worried about the fact that J. Kemper, the Chairman & CEO recently netted about US$2.2m selling shares at an average price of US$149. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 0.8%.

UMB Financial Insider Transactions Over The Last Year

In fact, the recent sale by Chairman & CEO J. Kemper was not their only sale of UMB Financial shares this year. Earlier in the year, they fetched US$129 per share in a -US$2.4m sale. That means that an insider was selling shares at slightly below the current price (US$146). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. 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 1.0% of J. Kemper's stake.

Over the last year, we can see that insiders have bought 1.22k shares worth US$143k. But insiders sold 103.66k shares worth US$13m. In total, UMB Financial insiders sold more than they bought over the last year. The average sell price was around US$129. It's not particularly great to see insiders were selling shares at below recent prices. But we wouldn't put too much weight on the insider selling. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.

Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. UMB Financial insiders own about US$426m worth of shares (which is 3.9% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

What Might The Insider Transactions At UMB Financial Tell Us?

Insiders sold UMB Financial shares recently, but they didn't buy any. Despite some insider buying, the longer term picture doesn't make us feel much more positive. But since UMB Financial is profitable and growing, we're not too worried by this. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company.

But note: UMB Financial may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.

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.