Todd A Adams Takes Money Off The Table, Sells $13.23M In Zurn Elkay Water Stock

Todd A Adams, Chairman and CEO at Zurn Elkay Water ZWS, executed a substantial insider sell on February 13, according to an SEC filing.

What Happened: A Form 4 filing from the U.S. Securities and Exchange Commission on Tuesday showed that Adams sold 407,571 shares of Zurn Elkay Water. The total transaction amounted to $13,232,667.

Zurn Elkay Water shares are trading down 3.36% at $31.25 at the time of this writing on Tuesday morning.

About Zurn Elkay Water

Zurn Elkay Water Solutions Corp designs procure, manufactures, and markets a range of clean water solutions for drinking water, hygiene, and sustainable water management. The Zurn Elkay product portfolio includes professional-grade water control and safety, water distribution and drainage, drinking water, finish plumbing, hygienic, environmental and site works products for public and private spaces.

Key Indicators: Zurn Elkay Water's Financial Health

Positive Revenue Trend: Examining Zurn Elkay Water's financials over 3 months reveals a positive narrative. The company achieved a noteworthy revenue growth rate of 4.85% as of 31 December, 2023, showcasing a substantial increase in top-line earnings. When compared to others in the Industrials sector, the company excelled with a growth rate higher than the average among peers.

Interpreting Earnings Metrics:

• Gross Margin: With a high gross margin of 43.69%, the company demonstrates effective cost control and strong profitability relative to its peers.

• Earnings per Share (EPS): Zurn Elkay Water's EPS is below the industry average. The company faced challenges with a current EPS of 0.08. This suggests a potential decline in earnings.

Debt Management: With a below-average debt-to-equity ratio of 0.34, Zurn Elkay Water adopts a prudent financial strategy, indicating a balanced approach to debt management.

Valuation Metrics: A Closer Look

• Price to Earnings (P/E) Ratio: The current Price to Earnings ratio of 54.8 is higher than the industry average, indicating the stock is priced at a premium level according to the market sentiment.

• Price to Sales (P/S) Ratio: A higher-than-average P/S ratio of 3.74 suggests overvaluation in the eyes of investors, considering sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): A high EV/EBITDA ratio of 21.84 positions the company as being more valued compared to industry benchmarks.

Market Capitalization Analysis: Falling below industry benchmarks, the company's market capitalization reflects a reduced size compared to peers. This positioning may be influenced by factors such as growth expectations or operational capacity.

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Navigating the Impact of Insider Transactions on Investments

Insightful as they may be, insider transactions should be considered alongside a thorough examination of other investment criteria.

In the context of legal matters, the term "insider" refers to any officer, director, or beneficial owner holding more than ten percent of a company's equity securities, as outlined by Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and significant hedge funds. Such insiders are obligated to report their transactions through a Form 4 filing, which must be completed within two business days of the transaction.

Pointing towards optimism, a company insider's new purchase signals their positive anticipation for the stock to rise.

Despite insider sells not always signaling a bearish sentiment, they can be driven by various factors.

Essential Transaction Codes Unveiled

When dissecting transactions, the focal point for investors is often those occurring in the open market, meticulously detailed in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S signifies a sale. Transaction code C indicates the conversion of an option, and transaction code A denotes a grant, award, or other acquisition of securities from the company.

Check Out The Full List Of Zurn Elkay Water's Insider Trades.

This article was generated by Benzinga's automated content engine and reviewed by an editor.