Michelle R Mortensen Takes a Bullish Stance: Acquires $80K In California Water Servs Gr Stock

Michelle R Mortensen, VP at California Water Servs Gr CWT, reported an insider buy on June 7, according to a new SEC filing.

What Happened: Mortensen's recent purchase of 1,616 shares of California Water Servs Gr, disclosed in a Form 4 filing with the U.S. Securities and Exchange Commission on Friday, reflects confidence in the company's potential. The total transaction value is $80,185.

During Friday's morning session, California Water Servs Gr shares down by 1.43%, currently priced at $48.52.

Get to Know California Water Servs Gr Better

California Water Service Group is a U.S. water and utilities holding company based in California. The company engages in the production, treatment, storage, distribution, and sale of water for various uses. The firm operates through its subsidiaries, which can be divided between regulated and unregulated businesses. The regulated public utilities subsidiaries operate in California, New Mexico, Washington, and Hawaii. The unregulated subsidiaries provide water utility services to private companies and municipalities. The company derives the majority of its revenue from its operations in California and, overall, from residential customers.

A Deep Dive into California Water Servs Gr's Financials

Revenue Growth: California Water Servs Gr's revenue growth over a period of 3 months has been noteworthy. As of 31 March, 2024, the company achieved a revenue growth rate of approximately 106.52%. This indicates a substantial increase in the company's top-line earnings. As compared to competitors, the company surpassed expectations with a growth rate higher than the average among peers in the Utilities sector.

Holistic Profitability Examination:

• Gross Margin: The company sets a benchmark with a high gross margin of 64.59%, reflecting superior cost management and profitability compared to its peers.

• Earnings per Share (EPS): California Water Servs Gr's EPS is a standout, portraying a positive bottom-line trend that exceeds the industry average with a current EPS of 1.21.

Debt Management: With a below-average debt-to-equity ratio of 0.91, California Water Servs Gr adopts a prudent financial strategy, indicating a balanced approach to debt management.

Assessing Valuation Metrics:

• Price to Earnings (P/E) Ratio: The Price to Earnings ratio of 19.53 is lower than the industry average, indicating potential undervaluation for the stock.

• Price to Sales (P/S) Ratio: The Price to Sales ratio is 3.03, which is lower than the industry average. This suggests a possible undervaluation based on sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): With an EV/EBITDA ratio lower than industry averages at 13.1, California Water Servs Gr could be considered undervalued.

Market Capitalization Analysis: The company exhibits a lower market capitalization profile, positioning itself below industry averages. This suggests a smaller scale relative to peers.

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Why Insider Activity Matters in Finance

Insider transactions shouldn't be used primarily to make an investing decision, however, they can be an important factor for an investor to consider.

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.

Important Transaction Codes

Surveying the realm of stock transactions, investors often give prominence to those unfolding in the open market, systematically detailed in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S signifies a sale. Transaction code C denotes 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 California Water Servs Gr's Insider Trades.

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