Matthew De Soto, a director at Mid Penn Bancorp (MPB), recently bought 2,355 shares. The buy increased his holdings by 4 percent, and came to a total cost of $50,001.
The director was also a buyer in late June, buying 362 shares for just under $8,000. Another company director was a buyer at the same time. Over the last two years, company directors and the CEO have been regular and steady buyers of shares, with no insider sales.
In total, insiders own 11.3 percent of shares.
The regional bank is down about 30 percent over the past year, reflecting weakness in the space following the collapse of two larger banks in March.
However, Mid Penn has held up well, with shares trading at 8 times earnings and with the bank sporting a 28 percent profit margin.
Plus, Mid Penn trades at about two-thirds of its book value. That indicates that shares are likely undervalued relative to their existing book of loans.
Action to take: Investors may like shares at current prices. The bank pays a 3.7 percent dividend, and likely has more upside ahead as the banking sector recovers from the selloff earlier this year.
For traders, options are limited. But the October $20 calls, last going for about $6.30, are already about $1.50 in-the-money. They could see mid-double-digit gains on a move higher for shares over the next two months.
Disclosure: The author of this article has no position in the company mentioned here, but does not intend to trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.