Potential Provident Bancorp, Inc. (NASDAQ:PVBC) shareholders may wish to note that the Director, Dennis Pollack, recently bought US$115k worth of stock, paying US$11.47 for each share. That's a very solid buy in our book, and increased their holding by a noteworthy 27%.

See our latest analysis for Provident Bancorp

The Last 12 Months Of Insider Transactions At Provident Bancorp

In fact, the recent purchase by Dennis Pollack was the biggest purchase of Provident Bancorp shares made by an insider individual in the last twelve months, according to our records. That means that an insider was happy to buy shares at above the current price of US$11.08. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. To us, it's very important to consider the price insiders pay for shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

Provident Bancorp insiders may have bought shares in the last year, but they didn't sell any. Their average price was about US$10.45. Although they bought at below the recent share price, it is good to see that insiders are willing to invest in the company. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

Provident Bancorp is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Does Provident Bancorp Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Our data indicates that Provident Bancorp insiders own about US$8.0m worth of shares (which is 4.3% of the company). We do generally prefer see higher levels of insider ownership.

So What Does This Data Suggest About Provident Bancorp Insiders?

It's certainly positive to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that Provident Bancorp insiders are expecting a bright future. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Case in point: We've spotted 1 warning sign for Provident Bancorp you should be aware of.

But note: Provident Bancorp 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 of direct interests only, but not derivative transactions or indirect interests.

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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.