Aleem Gillani, a director at U.S. Bancorp (USB), recently bought 10,000 shares. The buy is an initial stake for the director, and came to a cost of $499,900.
This marks the first insider buy since January 2017. This year, there have been four insider sales, three of which occurred following the exercise of stock options. The largest sale was for $3.86 million from the company’s President and CEO.
Overall, USB insiders own 0.1% of shares.
The regional bank is up 16% over the past year, coming well off the lows from the crisis in the spring of 2023. However, it’s still underperformed the overall stock market.
U.S. Bancorp trades at less than 12 times forward earnings. Revenues have been flat over the past year, but overall earnings are up about 18%.
USB has a 21% profit margin right now, a reasonable return given the challenges with the lack of loan demand at today’s interest rates.
Action to take: Investors may want to consider a small position here, and to add to it on any pullback, particularly if the pullback relates to fears in the banking space. U.S. Bancorp is likely big enough to be considered too big to fail.
Plus, U.S. Bancorp is a dividend growth stock, currently paying a 4.4% yield against an historical average payout of 4%.
For traders, the October $45 calls are an at-the-money trade. They can likely see mid-double-digit returns before expiration. Traders will likely want to take profits well before expiration.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.