Some East West Bancorp, Inc. (NASDAQ:EWBC) shareholders may be a little concerned to see that the Vice Chairman & Chief Corporate Officer, Douglas Krause, recently sold a substantial US$1.3m worth of stock at a price of US$132 per share. That sale reduced their total holding by 13% which is hardly insignificant, but far from the worst we've seen.

East West Bancorp Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Chairman, Dominic Ng, sold US$7.5m worth of shares at a price of US$125 per share. That means that an insider was selling shares at slightly below the current price (US$132). 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. This single sale was just 6.9% of Dominic Ng's stake.

East West Bancorp insiders didn't buy any shares 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 want to know exactly who sold, for how much, and when, simply click on the graph below!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

Does East West Bancorp Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. East West Bancorp insiders own 0.9% of the company, currently worth about US$153m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Do The East West Bancorp Insider Transactions Indicate?

Insiders haven't bought East West Bancorp stock in the last three months, but there was some selling. And even if we look at the last year, we didn't see any purchases. But it is good to see that East West Bancorp is growing earnings. 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 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.

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.

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.