CBA (ASX:CBA) share price on watch as CEO sells $1.4m of shares

CBA's CEO has been selling shares…

| More on:
An analyst wearing a dark blue shirt and glasses sits at his computer with his chin resting on his hands as he looks at the CBA share price movement today

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • CBA's CEO has been selling shares on-market.
  • Matt Comyn offloaded $1.4 million worth of shares on Tuesday.
  • Though, the CEO of Australia's largest bank still has a significant interest.

Insider buying is often regarded as a bullish indicator. This is because few people should know a company better than its own directors.

The theory is that if they have the confidence to buy shares, it could be a sign that things are going well and they expect them to appreciate in value.

Conversely, when directors sell shares, it is often regarded as a bearish signal. After all, you'd be unlikely to sell shares if you thought they were about to increase in value.

With that in mind, this morning Commonwealth Bank of Australia (ASX: CBA) revealed that an insider has been selling some of the banking giant's shares.

What did CBA announce?

According to a change of director's interest notice from this morning, CBA Chief Executive Officer (CEO), Matt Comyn, has been trimming down his holding this week.

The notice reveals that Mr Comyn sold a total of 13,520 shares through an on-market trade on Tuesday 15 March 2022. This represented 21.2% of Comyn's direct interest in the bank, reducing his direct holding down to 50,003 shares.

The leader of Australia's largest bank received an average of $103.40 per share, which equates to a total consideration of approximately $1.4 million.

Time to panic?

While the CBA share price has rallied hard and is trading within touching distance of its record high, it may be unwise to panic.

After all, Comyn still has a sizeable direct holding of CBA shares with a market value of ~$5.3 million. In addition, the CEO has a hefty indirect holding of 32,084 shares and countless performance rights that could vest in the coming years.

This, you could argue, means that the CEO's interests remain firmly aligned with shareholders' interests.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Bank Shares

A man sits in contemplation on his sofa looking at his phone as though he has just heard some serious or interesting news.
Bank Shares

Here's when Westpac says the RBA will now cut interest rates

The RBA surprised everyone by keeping rates on hold last week. So, when will the next cut happen?

Read more »

Hand holding Australian dollar (AUD) bills, symbolising ex dividend day. Passive income.
Bank Shares

This is the ASX bank stock with the largest dividend yield right now

Looking to ASX bank stocks for dividend income right now?

Read more »

A man sits in deep thought with a pen held to his lips as he ponders his computer screen with a laptop open next to him on his desk in a home office environment.
Bank Shares

ASX banking sector: Is it time to consider a regional bank?

The big 4 banks are widely considered to be overvalued.

Read more »

A person leans over to whisper a secret to a colleague during a meeting.
Bank Shares

Here are the latest growth forecasts for the CBA share price

Can the bank continue rising? Here are some expert views.

Read more »

A businessman presents a company annual report in front of a group seated at a table
Bank Shares

Earnings season predictions: Macquarie weighs in on the big 4 banks

What are the broker's predictions?

Read more »

Contented looking man leans back in his chair at his desk and smiles.
Bank Shares

Major CBA investor reveals why he's all in

This investor described one major reason driving his investment in CBA shares.

Read more »

Young investor sits at desk looking happy after discovering Westpac's dividend reinvestment plan
Bank Shares

Invested $10,000 in Westpac shares 2 years ago? Guess how much you've already banked!

Atop their regular dividend payments, Westpac shares have enjoyed a strong two-year run.

Read more »

Woman calculating dividends on calculator and working on a laptop.
Bank Shares

Buying CBA stock today? Here's the dividend yield you'll get

CBA's yield right now might surprise you.

Read more »