Wallace R Weitz Boosts Confidence With $369K Purchase Of Cable One Stock

Wallace R Weitz, Board Member at Cable One CABO, reported an insider buy on May 22, according to a new SEC filing.

What Happened: In a Form 4 filing on Wednesday with the U.S. Securities and Exchange Commission, it was disclosed that Weitz bought 1,000 shares of Cable One, amounting to a total of $369,980.

Tracking the Thursday's morning session, Cable One shares are trading at $351.98, showing a down of 0.0%.

Unveiling the Story Behind Cable One

Cable One Inc is a telecommunications company. It derives revenue from the provision of broadband, voice, and video services to residential and business customers. From a product perspective, the majority of revenue is sourced from data and video services. This revenue is subscription-based and billed monthly. The company also offers Sparklight TV, an internet protocol-based (IPTV) video service that allows customers with Sparklight TV app to stream video channels from the cloud. The company also derives advertising revenue from selling airtime on its video channels. Voice services are offered over Internet protocols. The company owns a telecommunications infrastructure.

Cable One: A Financial Overview

Decline in Revenue: Over the 3 months period, Cable One faced challenges, resulting in a decline of approximately -4.17% in revenue growth as of 31 March, 2024. This signifies a reduction in the company's top-line earnings. In comparison to its industry peers, the company trails behind with a growth rate lower than the average among peers in the Communication Services sector.

Insights into Profitability:

• Gross Margin: The company maintains a high gross margin of 73.66%, indicating strong cost management and profitability compared to its peers.

• Earnings per Share (EPS): With an EPS below industry norms, Cable One exhibits below-average bottom-line performance with a current EPS of 8.43.

Debt Management: Cable One's debt-to-equity ratio is below industry norms, indicating a sound financial structure with a ratio of 1.87.

Assessing Valuation Metrics:

• Price to Earnings (P/E) Ratio: The current Price to Earnings ratio of 8.07 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: With a higher-than-average P/S ratio of 1.28, Cable One's stock is perceived as being overvalued in the market, particularly in relation to sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): Cable One's EV/EBITDA ratio, surpassing industry averages at 5.94, positions it with an above-average valuation in the market.

Market Capitalization Analysis: Below industry benchmarks, the company's market capitalization reflects a smaller scale relative to peers. This could be attributed to factors such as growth expectations or operational capacity.

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Navigating the Impact of Insider Transactions on Investments

It's important to note that insider transactions alone should not dictate investment decisions, but they can provide valuable insights.

In legal terms, an "insider" refers to any officer, director, or beneficial owner of more than ten percent of a company's equity securities registered under Section 12 of the Securities Exchange Act of 1934. This can include executives in the c-suite and large hedge funds. These insiders are required to let the public know of their transactions via a Form 4 filing, which must be filed within two business days of the transaction.

When a company insider makes a new purchase, that is an indication that they expect the stock to rise.

Insider sells, on the other hand, can be made for a variety of reasons, and may not necessarily mean that the seller thinks the stock will go down.

A Closer Look at Important Transaction Codes

Digging into the details of stock transactions, investors frequently turn their attention to those taking place in the open market, as outlined in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S signifies a sale. Transaction code C signals 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 Cable One's Insider Trades.

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