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Multiple insiders bought CapStar Financial Holdings, Inc. (NASDAQ:CSTR) stock earlier this year, a positive sign for shareholders

It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in CapStar Financial Holdings, Inc.'s (NASDAQ:CSTR) case, it's fantastic news for shareholders.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

See our latest analysis for CapStar Financial Holdings

The Last 12 Months Of Insider Transactions At CapStar Financial Holdings

In the last twelve months, the biggest single purchase by an insider was when insider Denis Duncan bought US$204k worth of shares at a price of US$21.13 per share. That means that an insider was happy to buy shares at above the current price of US$20.15. Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

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CapStar Financial Holdings insiders may have bought shares in the last year, but they didn't sell any. 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!

insider-trading-volume
insider-trading-volume

CapStar Financial Holdings is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insider Ownership

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. CapStar Financial Holdings insiders own about US$86m worth of shares. That equates to 19% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At CapStar Financial Holdings Tell Us?

The fact that there have been no CapStar Financial Holdings insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. Insiders do have a stake in CapStar Financial Holdings and their transactions don't cause us concern. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To assist with this, we've discovered 1 warning sign that you should run your eye over to get a better picture of CapStar Financial Holdings.

But note: CapStar Financial Holdings 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, but not derivative transactions.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.