Kenneth Vecchione, President and CEO of Western Alliance Bancorp (WAL), recently added 5,600 shares to his holdings. The buy increased his stake by nearly 2 percent, and came to a total price of just over $548,000.
He was also joined by the company CFO, who picked up 5,000 shares for nearly $499,000. Another insider picked up 200,000 shares back in September, but otherwise, company insiders have generally been sellers over the past three years.
Overall, company insiders own about 2.8 percent of outstanding shares.
The regional bank is up about 34 percent in the past year, earning about twice the return of the S&P 500 index. Revenue growth has come in strong with a 45 percent jump, and the bank has an impressive 47 percent profit margin. The only downside? The bank trades at a significant premium to its book value, which tends to be a conservative measure of how a bank’s loans are valued.
Action to take: With shares trading at 10 times forward earnings, investors may like shares here. The company recently upped its annual dividend from $1.10 to $1.40, for a 1.4 percent starting dividend yield for today’s buyers.
For traders, shares have recently come off of all-time highs with the recent market selloff. The May $120 calls, last going for about $2.10, could offer mid-to-high double-digit returns on a rebound in shares in the next few months.
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 of the companies mentioned in this article.