Zurn Elkay Water Insider Trades Send A Signal

On June 21, a recent SEC filing unveiled that Ice Mountain LLC, 10% Owner at Zurn Elkay Water ZWS made an insider sell.

What Happened: A Form 4 filing from the U.S. Securities and Exchange Commission on Friday showed that LLC sold 154,433 shares of Zurn Elkay Water. The total transaction amounted to $4,714,839.

As of Friday morning, Zurn Elkay Water shares are up by 0.17%, currently priced at $30.35.

Get to Know Zurn Elkay Water Better

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.

Breaking Down Zurn Elkay Water's Financial Performance

Revenue Growth: Over the 3 months period, Zurn Elkay Water showcased positive performance, achieving a revenue growth rate of 0.46% as of 31 March, 2024. This reflects a substantial increase in the company's top-line earnings. When compared to others in the Industrials sector, the company faces challenges, achieving a growth rate lower than the average among peers.

Analyzing Profitability Metrics:

• Gross Margin: Achieving a high gross margin of 45.51%, the company performs well in terms of cost management and profitability within its sector.

• Earnings per Share (EPS): Zurn Elkay Water's EPS is below the industry average, signaling challenges in bottom-line performance with a current EPS of 0.2.

Debt Management: Zurn Elkay Water's debt-to-equity ratio is below the industry average at 0.33, reflecting a lower dependency on debt financing and a more conservative financial approach.

Assessing Valuation Metrics:

• Price to Earnings (P/E) Ratio: The current Price to Earnings ratio of 46.62 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: The current P/S ratio of 3.49 is above industry norms, reflecting an elevated valuation for Zurn Elkay Water's stock and potential overvaluation based on sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): Zurn Elkay Water's EV/EBITDA ratio of 19.88 exceeds industry averages, indicating a premium valuation in the market

Market Capitalization Perspectives: The company's market capitalization falls below industry averages, signaling a relatively smaller size compared to peers. This positioning may be influenced by factors such as perceived growth potential or operational scale.

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Navigating the Impact of Insider Transactions on Investments

Insider transactions are not the sole determinant of investment choices, but they are a factor worth considering.

Within the legal framework, an "insider" is defined as any officer, director, or beneficial owner holding more than ten percent of a company's equity securities as per Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and major hedge funds. These insiders are mandated to disclose their transactions through a Form 4 filing, to be submitted within two business days of the transaction.

The initiation of a new purchase by a company insider serves as a strong indication that they expect the stock to rise.

However, insider sells may not always signal a bearish view and can be influenced by various factors.

Important Transaction Codes

When it comes to transactions, investors tend to focus on those in the open market, detailed in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S indicates 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 Zurn Elkay Water's Insider Trades.

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