Insiders Are Selling Refiners and Skipping Banks. Here's What the Filings Tell You

Executives at Par Pacific and PBF Energy have been selling shares after gains of 149% and 210% this year, and the same filings that show those sales reveal something bigger: financial insiders have nearly stopped buying.

The numbers tell the story. Insider buying across financial firms has fallen to a near 23-year low, per VerityData. That's not a one-quarter blip. It's been building as rates stayed elevated and bank stocks went nowhere.

How It Played Out

The refining trade worked all year. Par Pacific ran 149%. PBF Energy ran 210%. Crack spreads stayed wide, diesel margins held, and the market rewarded anyone with barrels and throughput.

Then the people running these companies started taking chips off the table. That's the part retail investors miss. Executives don't sell because they think the business is broken. They sell because the stock already priced in a very good year. Notably, a lot of those sales came through pre-scheduled plans, which makes the timing less of a signal than it looks.

Meanwhile, on the financial side, nothing. Buying dried up to a level we haven't seen in over two decades. Bank CEOs, regional lenders, insurers, brokers, they've all gone quiet on open-market purchases.

What Actually Changed

Two things. First, refiners lost their best buyers. The insiders themselves. When the people with the clearest view of margins stop adding, the marginal buyer shifts to momentum funds and retail. That's a thinner, jumpier shareholder base.

Second, the bank silence matters more than most people think. Insider buying at financials is one of the cleanest sentiment reads in the market. It isn't driven by retail hype or ETF flows. It's a C-suite putting personal capital behind a thesis. When that disappears for the longest stretch in 23 years, you've to ask what they're seeing that the sell side isn't.

So what should you actually do with this? VerityData's Ben Silverman makes a fair point: insider data works better on single names than on whole sectors. Don't trade a sector off a headline. Read the individual filings.

Here's what matters when you do. Look at Form 4s, not press releases. Check whether the sale was a 10b5-1 plan or an open-market discretionary trade. Check the size relative to the executive's total holdings. A CEO selling 5% of his stake after a 200% run is routine. A CFO dumping 60% isn't.

The bank buying drought is the real signal, and it's a defensive one. Refiner selling after a huge year is mostly noise. Financial insiders refusing to add exposure is a statement about credit quality and rate paths that the tape hasn't fully priced.

What to Watch Next

Watch Q4 earnings and the guidance that comes with them. If refiners guide crack spreads tighter for next year, expect more insider sales to follow. And expect the stocks to give back part of those gains.

On the financials, watch for any cluster of open-market buys. One purchase doesn't change anything. Three or four within a few weeks across different banks would. That would tell you the people closest to credit quality think the worst is priced in.

Also watch buybacks. Companies can return capital without insiders risking their own money. If banks lean on repurchases while executives stay on the sidelines, that tells you they like the stock but not enough to buy it personally. Frankly, that's a weaker signal than the market wants to admit.

Insider filings aren't a crystal ball. They're a paper trail. Right now, that trail says the smart money in refining is cashing out, and the smart money in banking isn't buying back in.