Yesterday, Bank of America CEO Brian Moynihan bought 30,000 shares in his company at around $13.02 a piece, or about $390,000 total, according to a filing with the Securities and Exchange Commission. Moynihan now owns 449,655 BofA shares, plus 4071.76 shares in his 401(k) and family trust. (Kind of weird to think of a CEO who takes home upwards of $6.5 million a year as having a 401(k), but whatever; CEOs have to plan for the future, too!)
Insider purchases are often seen as a bullish indicator because they mean management has more to lose if the company performs poorly. Plus, if Moynihan, the guy who ought to know Bank of America best at this point, is buying the stock, it must be a good idea, right? Well, shares have been trading right around the lowest price they’ve commanded this year, so as far as we know, his timing is good.
On the other hand: We broke out our four-function calculator and determined that with BofA shares currently trading at around $12.65, Moynihan basically lost $11,100 overnight. Maybe he would’ve been better off in bonds.
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