Anyone interested in Hope Bancorp, Inc. (NASDAQ:HOPE) should probably be aware that the Independent Director, Daisy Ha, recently divested US$385k worth of shares in the company, at an average price of US$14.25 each. However, the silver lining is that the sale only reduced their total holding by 5.1%, so we're hesitant to read anything much into it, on its own.

The Last 12 Months Of Insider Transactions At Hope Bancorp

Notably, that recent sale by Independent Director Daisy Ha was not the only time they sold Hope Bancorp shares this year. They previously made an even bigger sale of -US$708k worth of shares at a price of US$12.57 per share. That means that an insider was selling shares at slightly below the current price (US$14.27). 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. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 8.8% of Daisy Ha's holding.

Hope Bancorp insiders didn't buy any shares over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

I will like Hope Bancorp better if I see some big insider buys.

Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Hope Bancorp insiders own about US$37m worth of shares. That equates to 2.0% 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 Do The Hope Bancorp Insider Transactions Indicate?

Insiders sold stock recently, but they haven't been buying. Looking to the last twelve months, our data doesn't show any insider buying. But since Hope Bancorp is profitable and growing, we're not too worried by this. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. So we'd only buy after careful consideration. While it's good to be aware of 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. For example - Hope Bancorp has 1 warning sign we think you should be aware of.

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.

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.