Hilltop Holdings' Chief Accounting Officer Sells 2,200 Shares for $77,000. Should Investors Be Concerned?

Hilltop Holdings's (NYSE:HTH) Chief Accounting Officer, Keith E. Bornemann, sold 2,200 shares in an open-market transaction on Nov. 25, 2025.

Transaction summary

Transaction value based on SEC Form 4 reported price ($35.00); post-transaction value based on Nov. 25 market close.

Key questions

• What proportion of Keith E. Bornemann’s holdings was sold in this transaction?
  The 2,200 shares sold represented 20.2% of his direct ownership immediately prior to the transaction, reflecting a significant reduction in exposure.
• How does this sale compare to Bornemann's historical selling activity?
  This transaction is in line with the historical size of his prior open-market sales, which have ranged from 2,200 to 2,500 shares, with a median of 2,500 shares for sell events and a typical offloading 18.7% of his Hilltop shares per event.
• How does the transaction value relate to Hilltop Holdings' recent stock performance?
  The sale was executed at $35.0 per share, which is 0.4% above the market close of $34.85 on the same day and 2.0% above the $34.32 price as of Nov. 29, 2025; the company’s one-year total return was 10.96% as of Nov. 29, 2025.
• What is Bornemann’s remaining stake in the company following this transaction?
  Post-sale, Bornemann holds 8,692 shares directly, valued at ~$302,916 as of the Nov. 25, 2025 close, representing approximately 0.0136% of outstanding shares.

Company overview

* 1-year performance calculated using Nov. 25, 2025 as the reference date.

Company snapshot

Hilltop Holdings is a diversified financial services company with a significant presence in regional banking, capital markets, and mortgage origination. It offers commercial and consumer banking, broker-dealer services, and mortgage origination, generating revenue from interest income, fees, and sales of financial products.

The regional bank operates a diversified model across three segments—banking, broker-dealer, and mortgage origination—generating income through lending, investment banking, securities trading, and mortgage services. It serves individuals, businesses, municipalities, and public entities primarily in regional U.S. markets.

The company's multi-segment structure enables it to capture revenue across a broad range of financial products and services, supporting resilience and growth in changing market conditions.

Foolish take

Bornemann's stock sale doesn't appear to be out of the ordinary. However, selling a fifth of his total holdings for a modest $77,000 may be viewed as an indication of the insider's lack of confidence in the stock's future appreciation.

The regional banking business hasn't been an easy one since the COVID-19 pandemic. While Hilltop Holdings managed to keep its core lending business somewhat intact over the last five years, its overall revenue has declined since 2020.

The good news is that revenue growth has modestly turned positive since the second half of 2023.

Critically, Hilltop's bottom line had also taken a hit, with diluted earnings per share (EPS) going from $4.58 and $4.61 in 2020 and 2021, respectively, to almost a third at $1.60 in 2022. The recovery has been modest ever since, with EPS at $0.74 at the end of 2024.

However, this year has witnessed a renaissance in both revenue and profits. Hilltop's total revenue and EPS for the third quarter have been the best in nearly four years, thanks to a strong loan pipeline growth and a $2.5 million credit loss reversal from improved economic conditions.

Not surprisingly, the stock has appreciated 11% over the last 12 months.

But things don't look too rosy at the moment, as U.S. home sales have been the lowest in 30 years, indicating subdued mortgage origination volumes. This could affect Hilltop's core business of lending, with a possible slowdown in net interest income growth over the next few quarters.

The market doesn't seem too optimistic about the business either, currently valuing the stock at 0.98 times its book value and just 14 times its trailing 12-month earnings.

Glossary

Open-market transaction: The purchase or sale of securities on a public exchange, not through private or pre-arranged deals.
SEC Form 4: A regulatory filing disclosing insider trades by company officers, directors, or major shareholders.
Direct ownership: Shares held personally by an individual, not through trusts or indirect accounts.
Outstanding shares: The total number of a company’s shares currently held by all shareholders.
Total return: The investment's price change plus all dividends and distributions, assuming those payouts are reinvested.
Dividend yield: Annual dividend income as a percentage of the stock’s current price.
Broker-dealer: A firm that buys and sells securities for clients and for its own account.
Mortgage origination: The process of creating and funding new mortgage loans for borrowers.
Interest income: Earnings generated from lending money, typically through loans or bonds.
TTM: The 12-month period ending with the most recent quarterly report.

Isac Simon has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.